Feature Article of Wednesday, 10 October 2012
Columnist: Sam, Leo R.
Managing Our Oil Revenue !!!
By Leo R. Sam
” Alberta and Canada lost a statesman, a leader and a visionary when Peter Lougheed passed away peacefully in Calgary on an Alberta blue sky day on September 13, 2012″
Alberta, Canada’s OIL RICH province was lucky enough to have chosen Premier Lougheed to lead the Progressive Conservative Party. He served as Premier from1971 – 1985.
Premier Lougheed accomplished a lot for the Province of Alberta. One legacy for which Albertans (Present and Future Generations ) will forever be grateful to Lougheed is the establishment of the ” ALBERTA HERITAGE SAVINGS TRUST FUND”.
BRIEF HISTORY OF THE FUND.
In 1976, the Premier of Alberta, the Honourable Peter Lougheed and his Progressive Conservative Government established the Alberta Heritage Savings Trust Fund for the People of Alberta.
“. .by an Act of Legislature with initial resources.. from the General Revenue Fund, THE ALBERTA HERITAGE SAVINGS TRUST FUND was established. Its purpose is to save and invest revenues from Alberta’s OIL and GAS..”
Initially, 30% of the Alberta’s non-renewable resources royalties was annually transferred to the fund. Later the transfer was reduce to 15%. Occasional adjustments were made as circumstances dictated.
At the moment, the fund stands at approximately $16,000.000.000.( Sixteen Billion Dollars)
Numerous major projects which have been funded by the INTEREST on the fund include:
1. The Alberta Oil Sand Technology and Research Authority ( $419million )
2. The Walter C. Mackenzie Health Sciences Centre ( $391 million ) ( The University of Alberta Hospital ) ***
3. Kananaski Country Recreational Development ( $225 million )
4. Major Irrigation Projects ( $503 million )
5. Alberta Agricultural Development Corporation ( $101.3 million
6. Alberta Mortgage and Housing Corporation ( $166.1 million )
7. Loans to other Canadian Provinces ( $1.2 billion )
8. Numerous scholarships for undergraduate as well as postgraduate studies.
*** A world-famous Ghanaian doctor, Dr. John Akabutu practices here. He is an
Emeritus Professor of the University of Alberta. He is a Top-level Consultant in
Paediatrics and an expert in Blood Disorders.
Over the last five years, groups of Senior Nurses from Ghana have come to this
Famous University of Alberta Hospital for advanced refresher courses.
Many Ghanaians have obtained Masters and Doctorate degrees in Computing Science,
Engineering, Geology, Mathematics, Chemistry, Political Science etc from the
University of Alberta.
(NOTE THAT ONLY THE INTEREST ON THE FUND HAS BEEN USED FOR THE PROJECTS MENTIONED ABOVE !!! ). The main fund is intact. The main fund remains untouched.
At the moment, almost everyone in Alberta knows that the value of this fund is sixteen billion dollars. There is absolutely no secrecy whatsoever about how the interest on the fund is used to build infra-structure, support medical and educational research, and support all kinds of scholarships. TRANSPARENCY is evident in the management of the fund. All Albertans therefore benefit from the oil industry.
There is a vibrant Ghana Friendship Association of Edmonton ( Inaugurated in 1976 ), which participates actively and positively in all relevant Albertan affairs.
The following former Ghana High Commissioners to Canada should be able to testify to the prudent manner in which Alberta manages its oil and gas revenue:
His Excellency Abankwa
His Excellency Daniel Ohene Agyekum
His Excellency Annan A. Cato
His Excellency Odoi-Sykes
Her Excellency Dr. Margaret Ivy Amoakohene.
This article is meant to draw the attention of “THE IMAGINARY PATRIOTIC PRESIDENT to how experienced and honest governments in DEVELOPED oil – rich countries manage their royalties. The Government of present day Ghana should take all steps necessary to prevent greedy individuals, who parade as entrepreneurs, from high jacking the oil industry to direct money into their personal bank accounts overseas.
Alberta, the oil capital of Canada has been in the oil business for more than sixty years. However, the question of royalties paid is still a sour problem.
In 2007, the newly elected Premier of Alberta ( Ed, Stelmach ) appointed a Panel of Experts to examine the problem of royalties paid by oil companies to the Government of Alberta. After carefully analyzing all the data available in many oil producing countries including Alaska, Norway, Nigeria, Libya etc, the panel RECOMMENDED that Alberta should hike the rate of royalties paid by the oil companies by 20%. The panel observed that even with this increase, the royalties paid will still be below the level charged by other oil-producing countries. As expected, the reaction of the oil companies was negative. They threatened to withdraw their investment from Alberta. The report published by the panel was entitled: FAIR SHARE.
Unpatriotic and selfish Ghanaians, who appear to have established cozy, dubious relationships with oil company officials should NOT be appointed to negotiate royalties on behalf of Ghana. CONFLICT OF INTEREST is likely to occur in the process. It is important to get honest knowledgeable people, who believe in social justice to negotiate with the powerful multinational oil companies.
Imagine an oil industry in Ghana depositing about 25% of the royalties into a Heritage Savings Trust Fund.
What a great TRUST FUND that would be !!!
Imagine using the interest on the Trust Fund to build TWO SUPER HIGHWAYS across Ghana:
1. From Takoradi to Lawra
2. From Tema to Navrongo
What an economic boost these highways will bring to all the ten regions in the country !!!
Imagine using the interest on the Trust Fund to convert the Korlebu Hospital in Accra and the Okomfo Anokye Hospital in Kumasi to the Standard of the World-Class University of Alberta Hospital !!! Our Leaders will no longer have to go abroad for medical check up. All Ghanaians will benefit.
The Ghana Government should establish a website to provide full information about the oil industry in the country. If a Heritage Trust Fund is ever established, one should be able to access all information on the internet. This should include:
1. The total amount in the Fund
2. Names of the board of Trustees
3. Long range plan for Projects to be undertaken ( At least a 5-Year Plan ).
4. Clearly stated criteria for awarding contracts.
5. Evidence to support COMPLETED projects.
The board of Trustees should DIRECTLY repot to PARLIAMENT. Under no circumstances should any official have the audacity to refuse to appear before parliament.
If ordinary Ghanaians are to benefit from the oil business, TRANSPARENCY is the key. Secrecy in any transaction will encourage corruption. Secret delegates should not be sent all over the world to negotiate or find information on behalf of Ghana. We are all aware that members of the large delegations often sent abroad just go shopping for their personal luxury items and/or spend the time attending to their medical needs at the expense of the country..
In this age of advanced technology, it is possible to conduct a lot of business through Tele-conferencing without leaving the office. Let our Ambassadors and other diplomats get involved in modern information technology to communicate and send relevant information back home. In the long run this will be far less expensive than the large delegations often sent abroad.
PARLIAMENT must truly be in control of the oil business. It must NOT just be a rubber stamp. The private oil companies must be allowed to recoup all their legitimate initial expenses plus a generous fair profit. However, GHANA deserves a fair share of the profits !!!
Let the discovery of oil be a BLESSING for Ghana instead of a CURSE.
Let the discovery of oil help produce a large MIDDLE CLASS of reasonably well-to- do Ghanaians instead of pockets of extremely filthy RICH INDIVIDUALS with huge bank accounts in Europe and America.
Let the discovery of oil help promote PEACE and DEVELOPMENT instead of UNDERDEVELOPMENT and WAR.
All the above wishes can be achieved with TRANSPARENCY, ZERO TOLERANCE FOR CORRUPTION and ACCOUNTABILTY.
It would be advantageous for all Ghanaian Embassies in oil-producing countries to appoint competent and honest officers to study the complex and often competitive oil business to be able to advise the minister of energy at home. Diplomats, who show any tendency to use their position to enrich themselves by using inside knowledge should be prosecuted. Ghana NOW needs a few RELIABLE diplomats, who are prepared to work for the COMMON GOOD.
It would be a very good idea to request the newly appointed Ghana High Commissioner to Canada, to obtain reliable information about the ALBERTA HERITAGE SAVINGS TRUST FUND from the government of Alberta.
Transparency, Real Zero Tolerance for Corruption, True Accountability and True Patriotism must be exhibited by our politicians, senior civil servants and at least 50.23% of all citizens of Ghana if we want our oil resource to be a BLESSING instead of a CURSE to our dear motherland-GHANA.
Who is going to be the “PETER LOUGHEED OF GHANA” ??? God Bless Ghana !!!
Edmonton, Alberta, Canada