Comment to the Press on KPMG Report re SML Contract

LIt is helpful that the President of Ghana accepts that infractions occurred in the award of the SML contracts, that have so far netted the company more than *1 BILLION GHS*. It was inevitable that the attempt to extend this same troubling arrangement to the mining & petroleum drilling sectors for an additional ~$100 million a year would not stand scrutiny, so the decision to halt that process was expected. As is also widely known, the pre-shipment inspection work SML took from West Blue and was being paid for was a duplication of existing services. The President has finally come to that same conclusion.

The Presidency's "whitepaper" also acknowledges that substantial work must be done to determine the country's needs before the award of any contracts for revenue assurance in the "downstream" fuel market (especially the linkages between the wholesale depots and fuel retail outlets). And it is a no-brainer that if any company is to render any service in this area at all, then they must receive a fixed fee and not be paid percentages of taxes collected by the State, which was the case in the now suspended SML contract.

However, we are seriously disappointed by a number of elements of the President's "whitepaper". We insist on seeing the full KPMG report. We dispute their apparent claim that any increase in petroleum consumption in Ghana should be attributed to SML. We demand an open forum to show that the weight of expert opinion in Ghana is against any such flawed reasoning.

Multiple petroleum economists are on standby to prove that no gains in consumption volume can be attributed to SML's work. We also have tax specialists on standby to prove that no tax gains due to SML's work can be ascertained to have occurred.

The *needs assessment* mentioned by the President must be concluded before SML or any other company receives a pesewa more of Ghana's money. Civil Society activists in the energy sector have lined up a long list of specialists willing to support a value for money and needs assessment pro bono.

We are thus challenging the President to accept this patriotic offer. Not one pesewa more of Ghana's money should go to SML or any other company until such an open, transparent, rigorous, and meritocratic process has been completed.

--- Bright Simons
www.brightsimons.com