Johnson Akuamoah Asiedu is the Auditor-General
The Auditor-General has directed the Petroleum Commission (PC) and Ghana Revenue Authority (GRA) to impose statutory penalties on International Oil Companies (IOCs) which fail to pay surface rental fees on time, warning that persistent defaults are eroding petroleum revenues and exposing weaknesses in enforcement of the country’s upstream fiscal regime.
This directive follows findings in the Auditor-General’s report on management of petroleum funds for the period January 1 to December 31, 2024, which show that several operators delayed or defaulted on mandatory surface rental payments into the Petroleum Holding Fund (PHF) – despite clear legal timelines and penalty provisions under petroleum revenue laws.
Under Regulation 5 of the Petroleum Revenue Management Regulations, 2019 (L.I. 2381), operators are required to self-assess surface rentals annually and pay amounts due into the PHF by February 28 of each year. In the case of new petroleum agreements, payment must be made within 60 days of ratification.
The Auditor-General noted that non-compliance with these requirements undermines predictability in petroleum revenue flows and weakens fiscal planning.
The law provides for sanctions in cases of default. Section 3 of the Petroleum Revenue Management Act, 2011 (Act 815) stipulates that entities that fail to meet payment deadlines must pay a penalty of five percent of the original amount for each day of default, or any higher rate prescribed under other applicable laws.
However, the report observed that these penalties have largely gone unenforced – reducing the deterrent effect intended by the law.
It is based on these findings that the Auditor-General charged the upstream regulator and country’s tax authority to move beyond administrative oversight and actively enforce penalties against defaulting companies to safeguard state revenues.
According to the report, total estimated proceeds from surface rentals at the reporting period’s end amounted to US$3.46million, made up of US$721,585 for the 2024 financial year and US$2.million in arrears from prior periods.
Yet only US$512,711.08 was paid into the Petroleum Holding Fund, highlighting a widening gap between expected and realised revenues.
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