Act 815 - Ministry of Finance - Ghana
Petroleum Revenue J\ianagement Act, 2011
Act 815
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ARRl\cNGEMENT OF SECTIONS Section
Preliminaty matters
1. 2. 3. 4. 5. 6.
Application Establishment of Petroleum HoldLl1g Fund Payment into Petroleum Holding Fund Payment v'lith petroleum in place of cash Prohibited use of Petroleum Holding Fund Petroleum Holding Fund receipts Other petroleum receipts
7. Carried and participating interest 8. Transparency and accountability of petroleum receipts Allocations and disbursements
9. Estabhshment and object of the Ghana Stabilisation Fund 10. Establishment and object of the Ghana Heritage Fund II. Ghana Petroleum Funds 12. "\Vithdrawals from the Ghana Stabilisation Fund D. Vlithdrawals from the Ghana Heritage Fund 14. Finality of payments 15. Reconciliations of Petroleum Holding Fund 16. Disbursement from the Petroleum Holding Fund
17. Benchmark Revenue 18. The Annual Budget Funding Amount 19. Transfers into the Consolidated Fund 20. Consolidation of Ghana Stabilisation Fund and Ghana Heritage Fund 21. Use of the Annual Budget Fundirlg Amount 22. Extra budgetary activities and statutory earmarking prohibited 23. Transfers into th.e Ghana Heritage Fund and Ghana Stabilisation Fund 24. Transfers for exceptional purposes Management and investment of Ghana Petroleum Funds
25. Obligations of the 11:inister 26. J\1:anagement obligations of the Bank of Ghana 27. Investment rules
Act 815
Pctroreurn Revenue IVfana;eremen( '-' Act~
20ll
28. Reports on the Ghana Petroleum Funds
29. Establishment of Investment AdvtSOi"Y Committee 30. Functions of the Investment Advisory Committee 31. Appointment of memhers of the Investm.:::Ht Advisory Committee 32. Tenure of office of members 33. J\.1eetings the Investment Advisory Committee
Disclosure of interest
35. Publication of membership of Lhe Investment Advisory Ccmur;ittee 36 Allowances 37. Secretanat of the Investment AdvISory Committee 38. Absence of advice from the Investn1ent Ad\~isory Comrniittee 39. Release of adVICe from the InvestmeEl Advisory CommittiiH
ACT
OF
PARLIAMENT OF THE REP OF GHANA
ENTITLED
LIe
PETROLEUJVf REVEI\ruE l\1ANAGE!\ffi1\l ACTr :D1iH 1 £~N
ACT to provide the framework for the coBection,
management of petroleum revenue m a responsible,
accountable and sustainable manner for the benefit
of Ghana in accordance \vith An.ide 36 of
related matuers.
DATE OF ASSENT: 11th April, 2011.
PASSED by Parliament and assented to by the President:
Preliminary matters
Application 1. (1) This Act shall regulate the collection, allocat!Oll and manage ment by govelnment of petroieum revenue cie11ved from upstream midstream petroleum operations. (2) \>"\!here there is any COlli"lict between the provisions of this and (a) any other enactment, or (b) the terms, conditions and stipulations in a petroleum authorisation, on the collectlOn, allocation and management of petroieum revenue, to.:: provisions of this Act shall prevaiL 4
Petroleum Revenue lvfanagement Ad, 2011
Act 815
Establishment of Petroleum Holding Fund 2. (l) A Petroleum Holding Fund is hereby established as a designated public fund at the Bank of Ghana to receive and disburse petroleum revenue due the Republic. (2) The petroleum revenue shall be deposited in the Petroleum Holding Fund for subsequent transfers in accordance with the provisions of this Act. Payment into Petroleum Holding Fund 3. (1) Petroleum revenue due the Republic derived from whatever source shall be assessed, collected and accounted for by the Ghana Revenue Authority. (2) The petroleum revenue assessed as due in each month shall be paid by direct transfer into the Petroleum Holding Fund by the fifteenth day of the ensuing month by the entities obliged to make the payment. (3) The entity shall notify the Ghana Revenue Authority in writing of the payment into the Petroleum Holding Fund. (4) Where the liability of an entity to make a payment 1S not dis charged on or before the due date, the entity shall pay as a penalty, an additional five percent of the original amount for each day of default or the default rate established under any other taw, whichever is higher. (5) For the purposes of this Act, petroleum revenue paid into the Petroleum Holding Fund shall not be (aj treated as part of the normal tax revenue ror purposes pro vided for in relevant laws of the Republic; and (bj used as the basis for the determination of any statutorily earmarked funds. Payment with petroleum in place of cash 4. (l) Where government elects for payment in petroleum instead of cash, the value of the petroleum in US Dollars on the day the petroleum is received by or on behalf of the government shall be reported and recorded by the Ghana Revenue Authority as the payments for the Petro leum Holding Fund. (2) The proceeds of the sale of die petroleum shall be credited to the Petroleum Holding Fund within sixty calendar days after the receipt of the petroleum. 5
Act 815 (3) \;llherepayments are made in petroleum, the US Dollarequiva lent of the payment on the of receipt shall be shown as a receipt. inw the Petroleum Hoiding Fund for purpose of reporting.
Prohibited use of Petroleo:m Holding Fund 5. (l) The amount in the Petroleum Holding Fund earmarked for transfer into the Ghana Petroleum Funds, shall not be used (a) to provide credit to the government, public enterprises, private sector entities or any other person or entity, and (f;) as collateral for guarantees, commitments or other liabilities of any other entity. (2) In order to preserve revenue streams from petroleum and ensure object of this Act, shail not be any bOITO\'\liIlg against Petroleum Holding Fund_ Petroleum Holding Fund receipts 6. The - shall constitute th.e gross receipts of Petroleum Holding Fund: (a) royalties from and additional oil entitlements, sur face rentals, other receipts from any petroleum operations and th.e sale or export of petroleum; (b) any amount from direct or indirect participation of government in petroleum operations; (c) corporate inoome taxes in cash from upstream and mid stream petrokum companies; (d) any amount payable by the national oil company as corpo rate income tax, royalty, dividends, or any other amount due ill acoordance with the laws of Ghana; and (e) any amollnt received by government direcdy or h'1rlireccty from petroleum resources not covered by paragraphs (a) to (d) i..'1:cludL.'lg \~'here applicable, capitai gains tax denved from the sale of0\vnership of exploration, development and duclloD rights. Other petmleum receipts
Carried and participating interest 7. (1) Revenue due from the direct or indirect participation of the Republic in petroleum operations, induding the carried and additional participating interests shaH be p;;:id into the Petroleum Holding Fund.
6
Petroleum Rel'e11l-ie Manager1'1ertt Act, 2011
Act 815
(2) The payment into the Petroleum Holding Fund shail be net of (a) (he equity financing cost, including advances and interest of the carried and participating interests of the Republic; and (b) the cash or the equivalent barrels of oil that shall be ceded to the national oil company out of the carried and participating interests recommended by the Minister and approved by Parliament. (3) For a period not exceeding fifteen years after the commence ment of this Act, the cash or the equivalent in barrels of oil ceded to a national oil company shall (a) not exceed fifty-five percent of the net cash flow from the carried and participating interests after deducting the equity financing cost under paragraph (aJ of subsection (2); and (b) be reviewed every three years by Parliament, but Parliament shall in each year approve the programme of activities of the national oil company.
Transparency and accountability of petroleum receipts 8. (1) For the purpose of transparency and accountability, the records ofpetroleum receipts in whatever form, shaH simultaneously be published by the :Minister in the Gazette and ill at least two state owned daily ne'Nspapers, within thirty calendar days after the end of the applicable quarter. (2) The information required to be made public shall also be publisbed online on the website of the Mmistry and pTesented to Parliament on the date of the Gazette publication. (3) The Minister shall publish the total petroleum output lifted and the reference prioe in the same manner as provided in subsections (1) and (2). Allocations and disbursements
Establishment and object of the Ghana Stabilisation Fund 9. (1) A Ghana Stabilisation Fund is hereby established. (2) The object of the Ghana Stabilisation Fund is to cushion the impact on or sustain public expendit"ure capacity during periods of un anticipated petroleum revenue shortfalls, 7
Act 815
201 J
(3) The Ghana Stabilisation Fund shaH receive from the Petroleum Holding Fund a percentage of petroleum revenue .6 determined by Pariia.rnent as savings tor the purpose of this Establishment and object of the Ghana Herit.age Fund 10. (1) A Ghana Heritage Fund is hereby established. (2) The object the Ghana Heritage Fund is to (aJ provide an endm",rment to support development for fiJ!Ure generations \\'hen petroleum reserves have bef:n depleted; and (b) receive excess petroleum revenue. (3) The Ghana Heritage Fund shall receive from the Petroieurn Hoiding Fund a percentage petroleum revenue which be detenllmed by Padiament as savings for the purpose of this Act. (4) Despite section 20, Parliament may by a resolution supported by the yotes of a majority of members of Parbament Zit intervals of years hom the date commencement of this /\efiue Management Act, 2011
Act 815
(e) a ~~mparison of the income in paragraph (d) with .(i} the benchmark performance indices provided to
u~e
Minister, and .(ii) the income of the previous nvofinanClaI years; (I) the liabilities of government borrowings; and (g) alist of persons holding positions required for the opera tion and performance of the Ghana Stabilisation Fund and
the .Ghana Heritage Fund, induding (i) the rvfinister, (ii) the chairperson and members of the Investment Advisory Committee, Oii) the Governor, and (iv) the investment manager, if any. (3) The sources of the information described in subsection (2) in whatever form induding the reports and statements, shall be annexed to the annual report Accountability, transparency and public oversight Transparency as a fundamental principle 49. (1) The management of petroleum revenue and savings shall always be carried out with the highest internationally accepted standards of trans parency and good governance. (2) The duties concerned with ancillary matters ofpetroleum revenue and savings shall be discharged with the highest internationally accepted standards of transparency and good governance. (3) Information or data. the disclosure of which could in particular prejudice significantly the perfonnance of the Ghana Petro leum Funds may be declared by die Minister as confidential, subject to the approval of Parliament.
(4) The declaration of confidentiality shall provide a dear expla nation of the reason for treating the information or data as classified, taking into account the principles of transparency and the right of the public to information. (5) The declaration of confidentiality shall not limit access to information by Parliament and the Public Interest Accountabilir-y' Com mittee established under tIns Act.
Act 815 (6) Any tmormat~ofi is dassified at the
have been published, as as the reason for it being treated as
shaH be av-ailabk: to tbe public upon request three years
da'te on WhlCh it could been published tbe reason
dassified is still valid.
(7) Parliament, the the of GhauB. and the Hllent Advisory Committee :m dIe performance of theu fl.mctions this Act, shall take the measures to entrench transparency mech,'l' msms fiee access the public to information. (8) The l'v'fhfl.ister shall ensure til.at this Act ana instruc1L'iom; rdated to the Petroleum Funds, the Operations ManagemcxIr AgTeement rhe aml11?J reports are readily available to the
Non-compliance wit"J]. an obligation to paulioise info:rmatl{)H 50. person ,,,rho to comply vI{itfl1 any obligation to publish irc f'Ormation provided in. this or causes another £2.[1 with infonnation, or in any manner hinders or C8..HSeS person w iundcr tile wil1~ obligations, conunits an and is liable on SmI'iffii.l'.ry conviction to a. fine not exceeding t\'i'O hundre.d a nd fifty penalty '-..,;..'c....."",;._"
Pmlb.Iic Interest and Acco,uutability Committee 51. A Public Interest Accountability Committee is hereby ....",;cc"cr Objects of the AccolfUlti'iluiiity Comt:ruttee 52.. objecr.s Accoumabiiity Committee are: (aJ LD monitor and cv;:;Juarc compliance with this by govenii ment and other releva.nt institutions in the mana.gement use of the petroleum revenues and irlVest.rtl.ent5 as in this (b) to proVIde space platform the public to debate whether spending prospects and management use revenues conform to development priorities as provid,:'4i: section 21 (3); and (c) to provide independent assessments on (he managernent .('(nd use of m revenues to Parliament and th~ executive ill rbe and perfonnance f
Act 815
--~---~-~-
ARRl\cNGEMENT OF SECTIONS Section
Preliminaty matters
1. 2. 3. 4. 5. 6.
Application Establishment of Petroleum HoldLl1g Fund Payment into Petroleum Holding Fund Payment v'lith petroleum in place of cash Prohibited use of Petroleum Holding Fund Petroleum Holding Fund receipts Other petroleum receipts
7. Carried and participating interest 8. Transparency and accountability of petroleum receipts Allocations and disbursements
9. Estabhshment and object of the Ghana Stabilisation Fund 10. Establishment and object of the Ghana Heritage Fund II. Ghana Petroleum Funds 12. "\Vithdrawals from the Ghana Stabilisation Fund D. Vlithdrawals from the Ghana Heritage Fund 14. Finality of payments 15. Reconciliations of Petroleum Holding Fund 16. Disbursement from the Petroleum Holding Fund
17. Benchmark Revenue 18. The Annual Budget Funding Amount 19. Transfers into the Consolidated Fund 20. Consolidation of Ghana Stabilisation Fund and Ghana Heritage Fund 21. Use of the Annual Budget Fundirlg Amount 22. Extra budgetary activities and statutory earmarking prohibited 23. Transfers into th.e Ghana Heritage Fund and Ghana Stabilisation Fund 24. Transfers for exceptional purposes Management and investment of Ghana Petroleum Funds
25. Obligations of the 11:inister 26. J\1:anagement obligations of the Bank of Ghana 27. Investment rules
Act 815
Pctroreurn Revenue IVfana;eremen( '-' Act~
20ll
28. Reports on the Ghana Petroleum Funds
29. Establishment of Investment AdvtSOi"Y Committee 30. Functions of the Investment Advisory Committee 31. Appointment of memhers of the Investm.:::Ht Advisory Committee 32. Tenure of office of members 33. J\.1eetings the Investment Advisory Committee
Disclosure of interest
35. Publication of membership of Lhe Investment Advisory Ccmur;ittee 36 Allowances 37. Secretanat of the Investment AdvISory Committee 38. Absence of advice from the Investn1ent Ad\~isory Comrniittee 39. Release of adVICe from the InvestmeEl Advisory CommittiiH
ACT
OF
PARLIAMENT OF THE REP OF GHANA
ENTITLED
LIe
PETROLEUJVf REVEI\ruE l\1ANAGE!\ffi1\l ACTr :D1iH 1 £~N
ACT to provide the framework for the coBection,
management of petroleum revenue m a responsible,
accountable and sustainable manner for the benefit
of Ghana in accordance \vith An.ide 36 of
related matuers.
DATE OF ASSENT: 11th April, 2011.
PASSED by Parliament and assented to by the President:
Preliminary matters
Application 1. (1) This Act shall regulate the collection, allocat!Oll and manage ment by govelnment of petroieum revenue cie11ved from upstream midstream petroleum operations. (2) \>"\!here there is any COlli"lict between the provisions of this and (a) any other enactment, or (b) the terms, conditions and stipulations in a petroleum authorisation, on the collectlOn, allocation and management of petroieum revenue, to.:: provisions of this Act shall prevaiL 4
Petroleum Revenue lvfanagement Ad, 2011
Act 815
Establishment of Petroleum Holding Fund 2. (l) A Petroleum Holding Fund is hereby established as a designated public fund at the Bank of Ghana to receive and disburse petroleum revenue due the Republic. (2) The petroleum revenue shall be deposited in the Petroleum Holding Fund for subsequent transfers in accordance with the provisions of this Act. Payment into Petroleum Holding Fund 3. (1) Petroleum revenue due the Republic derived from whatever source shall be assessed, collected and accounted for by the Ghana Revenue Authority. (2) The petroleum revenue assessed as due in each month shall be paid by direct transfer into the Petroleum Holding Fund by the fifteenth day of the ensuing month by the entities obliged to make the payment. (3) The entity shall notify the Ghana Revenue Authority in writing of the payment into the Petroleum Holding Fund. (4) Where the liability of an entity to make a payment 1S not dis charged on or before the due date, the entity shall pay as a penalty, an additional five percent of the original amount for each day of default or the default rate established under any other taw, whichever is higher. (5) For the purposes of this Act, petroleum revenue paid into the Petroleum Holding Fund shall not be (aj treated as part of the normal tax revenue ror purposes pro vided for in relevant laws of the Republic; and (bj used as the basis for the determination of any statutorily earmarked funds. Payment with petroleum in place of cash 4. (l) Where government elects for payment in petroleum instead of cash, the value of the petroleum in US Dollars on the day the petroleum is received by or on behalf of the government shall be reported and recorded by the Ghana Revenue Authority as the payments for the Petro leum Holding Fund. (2) The proceeds of the sale of die petroleum shall be credited to the Petroleum Holding Fund within sixty calendar days after the receipt of the petroleum. 5
Act 815 (3) \;llherepayments are made in petroleum, the US Dollarequiva lent of the payment on the of receipt shall be shown as a receipt. inw the Petroleum Hoiding Fund for purpose of reporting.
Prohibited use of Petroleo:m Holding Fund 5. (l) The amount in the Petroleum Holding Fund earmarked for transfer into the Ghana Petroleum Funds, shall not be used (a) to provide credit to the government, public enterprises, private sector entities or any other person or entity, and (f;) as collateral for guarantees, commitments or other liabilities of any other entity. (2) In order to preserve revenue streams from petroleum and ensure object of this Act, shail not be any bOITO\'\liIlg against Petroleum Holding Fund_ Petroleum Holding Fund receipts 6. The - shall constitute th.e gross receipts of Petroleum Holding Fund: (a) royalties from and additional oil entitlements, sur face rentals, other receipts from any petroleum operations and th.e sale or export of petroleum; (b) any amount from direct or indirect participation of government in petroleum operations; (c) corporate inoome taxes in cash from upstream and mid stream petrokum companies; (d) any amount payable by the national oil company as corpo rate income tax, royalty, dividends, or any other amount due ill acoordance with the laws of Ghana; and (e) any amollnt received by government direcdy or h'1rlireccty from petroleum resources not covered by paragraphs (a) to (d) i..'1:cludL.'lg \~'here applicable, capitai gains tax denved from the sale of0\vnership of exploration, development and duclloD rights. Other petmleum receipts
Carried and participating interest 7. (1) Revenue due from the direct or indirect participation of the Republic in petroleum operations, induding the carried and additional participating interests shaH be p;;:id into the Petroleum Holding Fund.
6
Petroleum Rel'e11l-ie Manager1'1ertt Act, 2011
Act 815
(2) The payment into the Petroleum Holding Fund shail be net of (a) (he equity financing cost, including advances and interest of the carried and participating interests of the Republic; and (b) the cash or the equivalent barrels of oil that shall be ceded to the national oil company out of the carried and participating interests recommended by the Minister and approved by Parliament. (3) For a period not exceeding fifteen years after the commence ment of this Act, the cash or the equivalent in barrels of oil ceded to a national oil company shall (a) not exceed fifty-five percent of the net cash flow from the carried and participating interests after deducting the equity financing cost under paragraph (aJ of subsection (2); and (b) be reviewed every three years by Parliament, but Parliament shall in each year approve the programme of activities of the national oil company.
Transparency and accountability of petroleum receipts 8. (1) For the purpose of transparency and accountability, the records ofpetroleum receipts in whatever form, shaH simultaneously be published by the :Minister in the Gazette and ill at least two state owned daily ne'Nspapers, within thirty calendar days after the end of the applicable quarter. (2) The information required to be made public shall also be publisbed online on the website of the Mmistry and pTesented to Parliament on the date of the Gazette publication. (3) The Minister shall publish the total petroleum output lifted and the reference prioe in the same manner as provided in subsections (1) and (2). Allocations and disbursements
Establishment and object of the Ghana Stabilisation Fund 9. (1) A Ghana Stabilisation Fund is hereby established. (2) The object of the Ghana Stabilisation Fund is to cushion the impact on or sustain public expendit"ure capacity during periods of un anticipated petroleum revenue shortfalls, 7
Act 815
201 J
(3) The Ghana Stabilisation Fund shaH receive from the Petroleum Holding Fund a percentage of petroleum revenue .6 determined by Pariia.rnent as savings tor the purpose of this Establishment and object of the Ghana Herit.age Fund 10. (1) A Ghana Heritage Fund is hereby established. (2) The object the Ghana Heritage Fund is to (aJ provide an endm",rment to support development for fiJ!Ure generations \\'hen petroleum reserves have bef:n depleted; and (b) receive excess petroleum revenue. (3) The Ghana Heritage Fund shall receive from the Petroieurn Hoiding Fund a percentage petroleum revenue which be detenllmed by Padiament as savings for the purpose of this Act. (4) Despite section 20, Parliament may by a resolution supported by the yotes of a majority of members of Parbament Zit intervals of years hom the date commencement of this /\efiue Management Act, 2011
Act 815
(e) a ~~mparison of the income in paragraph (d) with .(i} the benchmark performance indices provided to
u~e
Minister, and .(ii) the income of the previous nvofinanClaI years; (I) the liabilities of government borrowings; and (g) alist of persons holding positions required for the opera tion and performance of the Ghana Stabilisation Fund and
the .Ghana Heritage Fund, induding (i) the rvfinister, (ii) the chairperson and members of the Investment Advisory Committee, Oii) the Governor, and (iv) the investment manager, if any. (3) The sources of the information described in subsection (2) in whatever form induding the reports and statements, shall be annexed to the annual report Accountability, transparency and public oversight Transparency as a fundamental principle 49. (1) The management of petroleum revenue and savings shall always be carried out with the highest internationally accepted standards of trans parency and good governance. (2) The duties concerned with ancillary matters ofpetroleum revenue and savings shall be discharged with the highest internationally accepted standards of transparency and good governance. (3) Information or data. the disclosure of which could in particular prejudice significantly the perfonnance of the Ghana Petro leum Funds may be declared by die Minister as confidential, subject to the approval of Parliament.
(4) The declaration of confidentiality shall provide a dear expla nation of the reason for treating the information or data as classified, taking into account the principles of transparency and the right of the public to information. (5) The declaration of confidentiality shall not limit access to information by Parliament and the Public Interest Accountabilir-y' Com mittee established under tIns Act.
Act 815 (6) Any tmormat~ofi is dassified at the
have been published, as as the reason for it being treated as
shaH be av-ailabk: to tbe public upon request three years
da'te on WhlCh it could been published tbe reason
dassified is still valid.
(7) Parliament, the the of GhauB. and the Hllent Advisory Committee :m dIe performance of theu fl.mctions this Act, shall take the measures to entrench transparency mech,'l' msms fiee access the public to information. (8) The l'v'fhfl.ister shall ensure til.at this Act ana instruc1L'iom; rdated to the Petroleum Funds, the Operations ManagemcxIr AgTeement rhe aml11?J reports are readily available to the
Non-compliance wit"J]. an obligation to paulioise info:rmatl{)H 50. person ,,,rho to comply vI{itfl1 any obligation to publish irc f'Ormation provided in. this or causes another £2.[1 with infonnation, or in any manner hinders or C8..HSeS person w iundcr tile wil1~ obligations, conunits an and is liable on SmI'iffii.l'.ry conviction to a. fine not exceeding t\'i'O hundre.d a nd fifty penalty '-..,;..'c....."",;._"
Pmlb.Iic Interest and Acco,uutability Committee 51. A Public Interest Accountability Committee is hereby ....",;cc"cr Objects of the AccolfUlti'iluiiity Comt:ruttee 52.. objecr.s Accoumabiiity Committee are: (aJ LD monitor and cv;:;Juarc compliance with this by govenii ment and other releva.nt institutions in the mana.gement use of the petroleum revenues and irlVest.rtl.ent5 as in this (b) to proVIde space platform the public to debate whether spending prospects and management use revenues conform to development priorities as provid,:'4i: section 21 (3); and (c) to provide independent assessments on (he managernent .('(nd use of m revenues to Parliament and th~ executive ill rbe and perfonnance f
