Ghana joined the ranks of Africa's oil exporters on Wednesday, pledging to work to ensure lucrative new revenues further bolster one of the continent's rising star economies. President John Atta Mills, wearing safety gear and blue overalls, opened the valves in a televised ceremony at the 330-metre-long floating platform some 40 miles (60 km) off the West African country's Atlantic coast.
Initial production of around 120,000 barrels per day (bpd) will rank Ghana as sub-Saharan Africa's seventh largest producer, with output set to double within three years. The start of commercial production came just three years after discovery of oil at the field, named Jubilee to mark the timing of the find 50 years after independence in 1957.
"After a long wait, the day has come," Mills said. "But ... it means that we are assuming a very serious responsibility. And especially for those who are in leadership positions, we must ensure that it becomes a blessing not a curse," he warned. Aside from state-owned Ghana National Petroleum Corporation (GNPC), major players in Jubilee include UK-listed operator Tullow Oil Plc, US-producer Anadarko Petroleum and privately held US energy firm Kosmos.
The event underlines the importance of the Gulf of Guinea as a growing source of energy to consumers such as United States, where some see it supplying a quarter of US oil by 2015. The region already counts Nigeria, Equatorial Guinea, Gabon and Congo Republic as exporters and others such as Liberia and Sierra Leone are hopeful of joining the club.
Ghana has taken advice in how to manage its oil sector from countries including Norway, and is anxious to avoid the strife and corruption which nearby Nigeria's oil has brought. "It will be a blessing because we are all jobless and poor," Brian Salmon, a 17-year-old small-holder in the Western Region coastal town of Takoradi said.
Ghana is the world's second largest cocoa producer after neighbouring Ivory Coast and Africa's no. 2 gold miner. It has a $750 million Eurobond currently yielding around 6.4 percent. Ghana expects Jubilee's oil and gas to help double its growth rate to over 12 percent next year, funding projects to boost infrastructure and laying the foundation for new industrial sectors. New data on Wednesday showed inflation running at 18-year lows.
Total revenue from oil into the 2011 budget is put at only 1.9 percent of GDP. Although this is due to rise over the years, the initial impact on the economy is seen as modest. Many are concerned a complex Petroleum Revenue Management Bill has yet to be voted by parliament and note the current draft allows 70 percent of revenues to be used as collateral against loans, a possible incitement to excess borrowing.