Ghana has accrued a total of $1.4 billion in savings from its crude oil resources since it commenced commercial production in 2010. This financial
Ghana has accrued a total of $1.4 billion in savings from its crude oil resources since it commenced commercial production in 2010.
This financial milestone was highlighted in the latest Petroleum Investment Report, which offers a detailed account of Ghana’s petroleum revenue performance and fund management over the past 15 years.
The savings, made through revenue from crude oil exports, taxes paid by oil firms, and rental fees for oil blocks, reflect Ghana’s efforts to ensure long-term financial stability and responsible resource management in its extractive sector.
But while the government celebrates the accumulated sum, some experts believe Ghana could have done better if certain reforms were implemented.
A Breakdown of the Petroleum Funds
According to the report, as of June 2025, the Ghana Stabilisation Fund—which was set up to mitigate the impact of oil revenue volatility on the national budget—had a book value of $122 million.
This marks a reduction from the $196 million it opened with at the beginning of the year, following a withdrawal of $121 million to support the budget amid fiscal pressures.
On the other hand, the Ghana Heritage Fund, which is designed as a long-term investment to support future generations when the country’s oil reserves are depleted, has seen significant growth.
It now holds a value of $1.3 billion. The fund’s steady rise is attributed to strict investment protocols and limited government access, ensuring that the money is safeguarded for posterity.
The Petroleum Holding Fund, which receives and disburses oil revenue into various accounts including the Consolidated Fund and the two savings funds, continues to maintain a portfolio focused on low-risk investments with high credit ratings and minimal default risks.
Calls for Legal and Investment Framework Reforms
Despite these financial gains, a growing number of energy economists and industry analysts are raising concerns about the effectiveness of the existing legal framework, particularly the Petroleum Revenue Management Act (PRMA), Act 893, which governs how Ghana’s oil wealth is managed.
The Act, first passed in 2011 and amended in later years, was intended to ensure transparency and fiscal responsibility in managing petroleum revenues from upstream and midstream operations.
However, critics argue that the law, while stringent, may be too restrictive in terms of investment options—limiting Ghana’s potential to earn higher returns.
Some analysts suggest that expanding the investment strategy beyond traditional fixed-income assets into more diverse, higher-yield global portfolios could have significantly increased the value of the petroleum funds.
Others recommend that the government explore additional revenue streams, such as downstream petroleum operations, local content development, and value addition within the oil sector.
Balancing Prudence and Growth
The debate underscores a broader tension between financial prudence and the need for growth in resource-based economies.
While Ghana has been commended for its cautious approach, especially compared to other oil-rich nations that have mismanaged revenues, the opportunity cost of low returns remains a key concern.
The current performance of the petroleum funds, according to watchdog groups, should serve as a basis for a national conversation on whether Ghana’s oil revenue strategy is fit for the future—especially as global energy markets evolve and the country’s petroleum reserves edge closer to their peak.
COMMENTS