The deputy Energy Minister, Andrew Egyapa Mercer, has confirmed that the initial consignment of 40,000 tons of oil brought into the country under the Gold-for-oil policy was purchased with cash instead of gold.
His disclosure comes after several calls by Industry experts such as the Institute of Energy Securities and COPEC for the government to disclose the quantity of gold it exchanged for the 40,000 metric tons of fuel as they raised questions over the viability of the deal.
The Minority in Parliament also questioned the feasibility of the policy arguing that it won't affect the current prices at the pumps.
Speaking in an interview, Mr Mercer said the companies they dealt with initially did not have the capacity to exchange gold for oil.
“The policy actually started with an intent to do strict barter for gold and petroleum products, but it became apparent that any of the international oil trading companies that do not have a commodity wing to deal with gold on their behalf will be excluded from the policy.
“We developed the policy such that we were operating two streams, one was direct barter and the second was monetising the gold, so we can pay for IOTs that were not other commodity focused but solely petroleum products…so the test run that we did was actually paid through the second route.”
Despite countless claims by Vice President Dr Mahamudu Bawumia that the gold for oil policy will reduce the pressure on forex and also present the country with cheaper fuel, fuel products have been increased twice since Ghana took delivery of the 40,000 tons of oil.
Speaking at this year's New Year School, Dr Bawumia said the gold for oil policy is the best for the country looking at the current economic challenges.
“…Ghana took delivery of its first cargo under the gold for oil policy. This is our test cargo, it is the cargo to test the framework if everything that has been put in place will work, by the grace of God the Framework will work and if that should happen we are going to save a lot of foreign exchange and reduce the pressure on our currency.”
The Member of Parliament for Yapei Kusawgu constituency, John Jinapor had predicted earlier that the country was heading for a debt crisis out of the gold for oil deal.
The legislator described the deal by the government “as a lazy man's approach, because gold, first of all, needs to be expressed in its monetary value. You can't just say take an ounce of gold and give me a barrel of oil, as it used to be in the real barter that you are talking about. You must first of all, value that gold in dollar terms, and that is the function of currency or money”.
