Africa
can assume upstream position in oil/gas industry
Ghana
earned 174 million dollars from export of wood products
Reconsider
Privatising National Oil Companies - Delegate
Accra (Greater Accra) 9 March 2000
Africa has the potential of assuming a
greater position in the oil and gas industry if she strives to be in the
upstream sector of the industry, a Planning and Development Officer said on
Wednesday.
Upstream industry deals in exploration,
drilling and production of crude oil as well as oil field services. Downstream
activities involve refining, distribution and sales.
Dr Ben Okey Oramah, Assistant Director,
Planning and Development, African Export-Import Bank (AFREXIMBANK) said this
when he spoke on the topic "Financing Oil Fields in Africa' at the fourth
Oil and Gas Africa 2000 Conference and Exhibition in Accra.
The Conference is also the fifth UNCTAD
African Oil and Gas Trade and Finance Conference.
Mr Oramah said Africa is capable of
attaining upstream position in the oil and gas business because it is well
endowed with oil and gas resources, accounting for about 10 per cent of global
oil production and 6.4 per cent of reserves.
"Africa indeed accounts for seven
per cent of global reserves, " increasingly higher quantities of oil and
gas reserves are being found in Africa's deep and ultra deep offshore areas,
especially in West Africa".
He predicted that the continent would
soon be the new frontier where production of high quality crude will be done,
as is being done now, at "competitive costs".
Mr Oramah said the physical production
environment remains easier than in most other major producing areas.
He, however, indicated that African
nations face certain weaknesses that have slowed down activities in exploration
and production.
He also said wars, community
disturbances, environmental problems are daunting factors that affect work in
the industry. In addition many countries have unclear rules and regulations
regarding award of concessions.
AFREXIMBANK
was established in 1993 by an agreement and a charter with shareholders
including African governments, African private investors and non-African
investors.
It has an authorised capital of 750
million dollars and headquartered in Cairo, Egypt. The Bank operates lines of
credit, direct financing, project-related financing and special risk
programmes, including country risk guarantee facility.
The bank has approved 2.3 billion dollars
between 1994 and 1999.
Mr Oramah debunked the notion of Africa's
over dependence on foreign technology and skills on the grounds that Africa has
immense potential in the area of oil and gas and urged companies to take
advantage of such skills.
He mentioned political instability and the
lack of finance as the other problems affecting the industry.
He said despite the weaknesses, activities
will continue to grow and AFREXIMBANK will be supporting them because the
underlying business is 'bankable' if financing is well designed.
"Supporting the companies will help
in creating indigenous capacity in the oil industry and help promote the goals
of governments of African oil producing countries.
"The bank's intervention usually
helps in better contract terms negotiated with producers", he added.
Mr Oramah said, transactions most often,
generate spin-off businesses from oil majors.
He mentioned lending with payment
guarantees and lending on credit standing of local banks, as some of the means
by which indigenous contractors receive support from the bank.
GRi../
Takoradi (Western Region) 9 March 2000
Ghana
earned 174 million dollars from the export of wood products last year as
compared to 171 million dollars in 1998.
In all
433,125 cubic metres of wood was exported as against 415,700 cubic metres the
previous year.
While the volume of export increased by
four per cent the value went up by only 1.6 per cent.
These were contained in an Export Permit
Report released by the Forest Products Inspection Division (FPID), in Takoradi.
The Report said in December 1999, the
country earned about 14.6 million dollars from the export of 36,767 cubic
metres of wood products while the corresponding figures for 1998 were almost
15million dollars from 36,475 cubic metres.
The export destinations were Germany,
Italy, United Kingdom, France, Saudi Arabia, United States, Ireland, Holland,
Belgium, Spain, Hong Kong, Burkina Faso, Australia and Taiwan, among other
countries.
GRi../
Ho (Volta Region) 9 March 2000
Mr Joachim Anku, Volta Regional Co-operative
Officer, has called on credit unions to take advantage of the several
investment opportunities in the country to expand their operations.
This, he
said, would require them to be market- oriented in their business approach in
order to provide high quality and competitive products.
Mr Anku made the call when he addressed
the fourth annual general meeting of the Ho District Teachers' Co-operative
Credit Union at Ho on Tuesday.
He called
for increased education for members in line with the principles of continuous
education for co-operative members and advice workers to join co-operative
credit unions and acquire the habit of savings to cushion them during their
retirement.
Mr Y.
Ankomah, Volta and Eastern Regional Zonal Manager of the Co-operative Credit
Union, who presented the audited report as at June 1999, said the union's
overall operations have been positive.
Mr Ankomah
suggested that share prices be increased from 40,000 cedis each to 80,000 cedis
with a minimum of two shares and a maximum of 15 shares per member.
GRi../
Accra (Greater Accra) 9 March 2000
A Gambian
delegate to the Oil and Gas Africa 2000 Conference and Exhibition has called on
the International Monetary Fund (IMF) and the World Bank to take another look
at the issue of privatization to minimise its impact on developing countries.
Mr Lamin
Kaba Jawara, Commissioner, Department of State for Trade, Industry and employment,
condemned the trend whereby most state assets are treated as scrap and given
out virtually free to companies that have profit as their prime
motive.
Mr Jawara said this in a contribution to a
discussion on "Privatisation of National Companies: Impact Upstream and
Down Stream", at the fifth Oil and Gas Africa 2000 Conference organised by
the Ghana National Petroleum Corporation, UNCTAD and FSG Media Limited of the
UK.
He said the story of privatisation in
Africa has not been a pleasant one, where most investors from abroad pay very
little for the companies and later operate them along profitable lines,
sometimes to the detriment of the communities they live in.
The conference is under the theme
"Africa, The Petroleum province of the 21st Century".
Mr Jawara said the two institutions, among
others, need to help African countries with enough expertise in the
privatisation process, instead of making them look like 'waste baskets' that
are worth nothing.
Such agencies should not only shout for
privatisation but also encourage governments and countries to move ahead
efficiently well after privatization, he said.
"This conference should come out in
the end with some recommendations that will protect not only the countries and
economies but the lives of the very people whom the entire process is meant to
enhance".
He said the experience in Gambia is not
any different, adding: "this situation is not new in Africa; no doubt
African governments have spoken at length about IMF policies in this
direction".
Dr. Duncan Clarke, Chairman, Global
Partners Pacific International and Executive Coordinator, African Institute of
Petroleum, said privatisation in the 21st. century, especially in national oil
companies, is inevitable.
He, however, said the format should be one
that suits the country after experiences of marginalisation over the years.
"Privatisation of national oil
companies in the 21st. century is inevitable since they need to adapt to
globalisation but this must be by design and not by default."
Dr. Clarke said privatisation solves
problems of removing unattainable objectives, conflicts and overstaffing that
lead to inefficiency in most companies.
"Privatisation keeps portfolio of
most companies in high quality and this provides good incentive to have a
motivated staff all way through."
Dr. Clarke said Cote d'Ivoire and Zambia
stand out as one of the countries in which desired change is taking place.
He was not impressed by the fact that in
Africa no major regional or national oil company players have emerged, stating
that all those in existence today are of foreign origin.
"I hope that very soon we will find
in our midst major national oil companies and we would have more cross-border
roles downstream."
He, therefore, urged African petroleum
companies to rise up and think of becoming more active on the continent.
Dr. Clarke said the situation is not the
best as there is not yet a single floatation, privatisation or no blue chip
government-private sector encounter.
He suggested more cross-border equity
stakes to move the industry forward.
Mr Tsatsu Tsikata, Chief Executive of the
GNPC, answering questions on how national oil companies see the inevitability
of privatisation on the continent, said national oil companies exist because
there are clear national objectives that must be achieved.
He, however, conceded hat privatisation is
a means of attracting investment capital to the further development of the oil
companies as well as their exploration activities.
Mr Tsikata said GNPC recognises this and
is promoting it in its corporate plan.
He said some of these roles could be played
by a ministry, but noted that "they are not corporate commercial vehicles
to go through the rigour of private entities in accessing funds".
GRi../
Accra (Greater Accra) 9 March 2000
The Ghana
Stock Exchange All-Share Index made its second impressive gain in 24 hours,
this time on the back of Ghana Commercial Bank, SSB Bank and Home Finance
Company, although most of the equities continued to be under negative pressure.
The GSE
All-Share Index, the main market indicator, leaped by 4.43 points to 748.15
points, 24 hours after it gained 2.18 points, its biggest gain in a very long
time.
The change
for the year shot up to 1.63 per cent from 1.03 per cent on Tuesday.
Ghana
Commercial Bank, which is the equity with the fourth highest market
capitalization, gained 40 cedis at 800 cedis after gaining 12 cedis on Tuesday.
SSB Bank,
which is the equity with the third highest market capitalisation after Ashanti
Goldfields Company and Standard Chartered Bank, gained five cedis at 1,995
cedis while HFC gained two cedis at 762 cedis, its first appreciation for many
months.
Unilever (UNIL) lost one cedi at 1,848.
At
Wednesday's trading, 1,420 shares of AGC, which is just emerging from arguably
the most troubled moments of its history, were offered, but there was no bid
and no sale.
There was
negative pressure on 13 of the 22 listed equities while SCB, one of the
heavyweights and the highest priced equity, had positive pressure on it.
Only 100
SCB shares were on offer but there were 1,700 bids. In the end there was no
sale.
All 4,200
GCB shares on offer were snapped up, far lower that bids of 52,500 shares.
Total
shares traded on Wednesday went down to 14,700 from 78,300 while bids were also
down by nearly half from 138,600 to 70,900.
Total shares
offered were down slightly from 621,350 to 554,620.
Market
capitalization was up at 3,224.22 billion cedis from 3,217.34 billion cedis.
The following are the last prices of
listed equities in cedis:
ABL 470
AGC 18,700
ALW 2,489
BAT 464
CFAO 40
EIC 1,880
FML 935
GBL 1,450
GCB 800 +40
GGL 974
HFC 762 +2
MGL 200
MLC 150
MOGL 14,500
PAF 294
PZ 800
SCB
19,300
SPPC
150
SSB 1,995 +5
UNIL 1,848 -1
UTC-E
125
CMLT
421