Tuesday, August 24, 2010

Ghana says oil production to start in December

* First output seen in December - VP
* Jubilee field reserves seen at 1.6 billion barrels


ACCRA, Aug 24 (Reuters) - Ghana is on track to pump its first barrel of crude in December but must be wary of seeing oil as the answer to all its problems, Vice President John Dramani Mahama said on Tuesday.

The West African state is poised to become one of the world's fastest-growing economies next year after its offshore Jubilee field comes on line.

It has said it is eager to avoid the "oil curse" of unevenly distributed wealth that has triggered unrest in other developing oil exporters.

"In December this year, Ghana will join the league of petroleum producing nations as commercial production begins in the Jubilee field," he told an oil and gas conference in the capital Accra. "Ghana cannot see the oil industry as a miracle wand to solve all problems."

He said the government was seeking to ensure transparency in the use of oil revenues from Jubilee, which he said holds about 1.6 billion barrels of crude, and to guarantee locals are employed in the sector.

Tullow Oil, operator of the Jubilee field, said in February output was scheduled to start in November, though the company and Ghanaian government officials have since said ouput would start by the end of the year.
The field will take four-to-six months to reach planned output of 120,000 barrels per day -- a level it will maintain for three years, Ghana's energy minister told Reuters in an interview last month.

The government has projected oil production will boost GDP growth to 20 percent in 2011, up from around 6 percent in 2010, making it one of the world's fastest growing economies.

Mahama said on Tuesday that oil revenues based on current reserves could account for about 7 percent of Ghana's GDP.

Analysts have said a key challenge for the government will be to ensure petroleum revenues benefit ordinary Ghanaians, many of whom live on less than $2 per day.

(Reporting by Kwasi Kpodo; editing by Richard Valdmanis)

Source: Reuters

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