PIAC urges review of GNPC laws to enable diversification into energy solutions

The Public Interest and Accountability Committee (PIAC) has called for a review of the laws governing the Ghana National Petroleum Corporation (GNPC) to allow the National Oil Company (NOC) to venture into providing integrated energy solutions. In its second Issue Paper titled “The Role of GNPC in the Upstream Petroleum Industry: Challenges and Prospects,” PIAC emphasized the necessity of updating the almost 40-year-old Provisional National Defence Council Law (PNDCL) 64 to enable GNPC to diversify and address the existential threat posed by the energy transition agenda.

PIAC highlighted that GNPC could utilize its existing capabilities and resources, such as engineering and project management skills, access to capital, and land and infrastructure assets, to engage in electricity generation and distribution, energy efficiency and management, as well as energy trading and marketing. Additionally, it could expand into renewable energy sources like solar, wind, hydro, and biofuels, alongside exploring low-carbon or carbon-neutral technologies such as hydrogen, carbon capture and storage, and electric vehicles.

The committee emphasized that the energy transition could potentially diminish the demand and value of traditional NOC products, exposing them to environmental, social, and governance (ESG) risks and liabilities, while undermining their competitive advantage and market share. This trend has led to increasing investor reluctance to fund hydrocarbon investments.

In light of these challenges, PIAC advised the government to empower GNPC to evolve into a stand-alone world-class operator capable of managing significant portions of the nation's upstream industry activities. This transformation aims to prevent the misallocation of resources and position GNPC to thrive in the energy transition era.

“The making of an effective NOC amid the energy transition is a complex and challenging task that requires strategic vision, innovation, and adaptation. To survive and thrive in the transition, NOCs need to rethink their strategies and business models and explore new opportunities and markets,” the paper concluded.