Bloomberg
The Ghanaian government may require oil companies to seek its approval before obtaining loans for their operations if a draft petroleum exploration and production bill becomes law, according to PricewaterhouseCoopers LLP.
A section of the law, to be debated by the lawmakers, said that loans taken by contractors must be approved by the minister of energy, Darcy White, a tax leader at the company’s Ghana office, said in a presentation on the bill at a meeting in Accra today.
“That can delay efforts,” he said, citing a lack of provisions in the draft policy for a loan-approval timeline. Interest on loans will be treated as a non-deductible expense on taxes, according to White.
Ghana became Africa’s newest oil exporter in December with the start of production at its offshore Jubilee oil field. Companies including London-based Tullow Oil Plc (TLW), Anadarko Petroleum Corp. (APC) of The Woodlands, Texas and Eni SpA (ENI) of Rome operate in the West African nation.
The draft law will be presented to lawmakers when Parliament returns from its recess next month, Moses Asaga, chairman of the parliamentary sub-committee on mines and energy, said in a telephone interview today. He declined to give details on the policy.
The requirement may be meant to ensure that international oil companies procure only loans that are competitive, Alex Mould, chief executive officer of Ghana’s fuel-retailing regulator National Petroleum Authority, said at the forum.
1 comment:
A smart move by the government who has already tied its hands with bad contractual agreement by accepting royalties. It may prevent fraudulent deductions based upon bad loan payments with wild interest rates. That provision should have been included in the agreement.
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