It has been more than a year since Ghanaian President John Atta Mills committed his government to the disclosure of all existing and future contracts with oil, gas and mining companies, and to date, his promise remains unfulfilled.
Firm decisions on transparency are increasingly urgent in Ghana, as the development of massive offshore oil reserves moves closer to the production phase. The Jubilee Field discovered in 2007 could eventually yield as much as 150,000 barrels of oil per day by some estimates.
With proposals for a new petroleum law recently released by lawmakers, and an increasing national frenzy over oil, the Revenue Watch Institute convened a public conversation this week in Accra focused exclusively on transparency in oil and mining contracts.
"Contracts transparency is the key to good governance in every sector," said panelist Augustine Niber of Ghana's Centre for Public Interest Law. "If contracts are really open to public scrutiny, contracts will not be signed if they are not in the interest of the public."
The panel also included Ama Jantuah Banful, chief state attorney from the Ghanaian Attorney General's office, Kwame Bosompem, a lawyer with the Commission for Human Rights and Administrative Justice, and Chris Anderson of Newmont Mining. Revenue Watch Advisory Board member Daniel Kaufmann of the Brookings Institution led the discussion as "challenger."
Representatives from Ghana's government joined members of the oil and mining industries, civil society leaders and members of the press for a dialogue designed to bring together multiple perspectives on this sometimes controversial topic.
Many extractive companies and resource producing countries have traditionally resisted the disclosure of natural resource contracts, but this secrecy often enables sophisticated forms of corruption and allows poorly-negotiated deals to continue outside public scrutiny. Companies in particular frequently insist on sweeping confidentiality clauses, arguing that contracts contain "trade secrets" that should be protected from competitors.
However, a recent Revenue Watch report reveals that many companies maintain these rules chiefly as a matter of habit. Based on a review of hundreds of natural resource agreements, RWI's Contracts Confidential report finds that most deals include very few matters of genuine commercial sensitivity.
"This is the time for Ghana to get oil right," said Emmanuel Kuyole, RWI Regional Coordinator and host of the contracts discussion. "President Atta Mills and the Ghanaian government cannot afford to let the excitement of the people for new wealth, or companies' eagerness for new profits, take precedence over practical decisions that can make the country's future more stable and more prosperous."
Chris Anderson of Newmont Mining said his company dispensed with privacy clauses in several Ghanaian contracts because "if you're a long-term investor, you want to build trust." Anderson, who is Newmont's Director for Corporate Affairs, added, "I cannot see one reason why investment agreements are kept confidential. I think the commercially-sensitive thing is an anachronism."
The adoption of a strong new legal framework for natural resources is a priority for Ghana, with production from the Jubilee Field scheduled to begin before the end of 2010. Though Parliament begins its new session in July, it remains unknown whether the current regulatory proposals will be formally introduced at that time. Whenever the draft legislation is presented, it is likely to include provisions for the contract transparency that President Atta Mills promised just after his 2009 inauguration.
Following the panel discussion, Ghana's Civil Society Platform on Oil and Gas hosted a citizens' summit on sustainable resource management. One of the key outcomes of the meeting was the resolution of civil society groups to recommend that the Ministries of Energy and Finance promote openness concerning important documents, including contracts, to further the transparency agenda.
Ghana is already a leader among African nations for its example of democracy and sound governance, and it showed a commitment to transparency in 2003 when it became an implementing country in the Extractive Industry Transparency Initiative (EITI), but the EITI's core principles of disclosure and participatory planning have yet to be fully established in the nation's emerging oil sector.
LEARN MORE
