Funding decommissioning in emerging petroleum producing countries: Ghana’s experience with decommissioning costs and guarantees

Oil and gas operators globally decommission their assets as they reach the end of their useful economic lives. To do this, regulators impose on operators financial tools to cover future decommissioning liabilities. However, research on decommissioning costs and guarantees in the upstream petroleum industry often focus on higher-income countries rather than nascent and emerging petroleum-producing ones. Our paper responds to this gap by examining Ghana's experience with decommissioning in its petroleum industry, which started commercial production in late 2010. Using critical legal and documentary analysis, we argue that Ghana has, since the mid-2000s, progressively but in a concerted manner worked at developing a framework which can serve as a model for similarly situated countries. Nascent producing countries need not reinvent the wheel or make the mistakes that Ghana made but can adopt aspects of its model as a blueprint for funding the eventual decommissioning of their upstream petroleum facilities. Critical lessons for new producer countries include need for proactivity, localisation, trigger, and burden sharing.