Last year, the Vice President, Dr. Mahamudu Bawumi announced a new government policy dubbed Gold for Oil (G4O).

1. GOVERNMENT OF
GHANA
GOLD FOR OIL
(G4O)
PROGRAMME
FRAMEWORK
3RD FEBRUARY 2023

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List of Acronyms:
Acronym Meaning
BIDECs/BDCs Bulk Import, Distribution and Export Companies
BoG Bank of Ghana
BOST Bulk Oil Storage and Transportation Company Ltd.
DGP Domestic Gold Purchase
G2G Government-to-Government
G4O Gold For Oil
IOTCs International Oil Trading Companies
LCs Letters of Credit
NPA National Petroleum Authority
OMCs Oil Marketing Companies
PMMC Precious Minerals and Marketing Company
QC Quality Certificate

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Introduction:
1. The Gold for Oil (G4O) Programme is an initiative of the Government of Ghana to use
the existing Bank of Ghana (BoG) Domestic Gold Purchase (DGP) Programme to
support the import of petroleum products into Ghana.
2. The prime objective of the programme is to use additional foreign exchange resources
from the BoG’s DGP programme to provide foreign currency for the importation of
petroleum products for the country which currently stands at about USD350 million per
month.
3. The government has begun the implementation of the G4O Programme where gold
purchases under the BoG’s DGP Programme mainly through the Precious Minerals and
Marketing Company (PMMC) and where required from aggregators and mining firms
is used to purchase petroleum products.
4. This is intended to free up foreign exchange resources to meet petroleum imports of the
country thereby reducing pressures on the Bank of Ghana’s foreign reserves and the
banking sector emanating from the Bulk Import, Distribution and Export Companies
(BIDECs) request for foreign exchange.
5. The programme also aims to procure petroleum products at very competitive prices
through Government-to-Government (G2G) arrangements. The programme will ensure
that the cost of importing the products from international oil traders will always be
comparatively lower.
6. The consequent reduction in foreign exchange pressures, the reduction in premiums
charged by international oil traders as well as efficiency gains from the value chain will
translate to lower ex-pump prices in the country.
The G4O Programme Process Flow and Requirements:
7. Under the programme, all the dore gold produced and exported by companies with
licensed small-scale concessions including community mines through the PMMC
shall be purchased by the BoG. The Ministry of Lands and Natural Resources has
issued directives towards the realisation of the programme.
8. The purchased dore gold is used for the payment of oil supply to Ghana. Payment for
oil supply is to be done in two channels: by way of barter trade or via broker channel.

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The Barter Channel:
• For suppliers willing to take gold in direct exchange for petroleum products,
BoG will provide equivalent volume of gold. Both the Bank and the
International Oil Trading Companies (IOTCs) are required to open Gold Metal
Accounts in a mutually agreed gold refinery for the purpose of gold transfer.
• BoG accumulates refined gold in its metal account at a refinery nominated by
a supplier to fund petroleum product shipments.
• BoG transfers equivalent amount of gold based on petroleum products supply
invoice from its metal account to a supplier’s metal account on receipt of
Quality Certificate (QC) of the product supplied and final invoice from Bulk
Oil Storage and Transport Company (BOST).
The Broker Channel:
• BoG executes a Gold Supply Agreement under which it sells gold to a gold
broker, which provides forex cover to pay for petroleum products.
• Gold Broker buys dore gold from BoG and deposits the proceeds in BoG gold
holding account.
• BoG transfers funds from gold holding account to an Escrow Account to pay
for petroleum product shipment on receipt of QC and final invoice from
BOST.
9. BOST, a state company, operates as an off taker for petroleum products, and therefore
executes an agreement with IOTCs for the import of petroleum products to Ghana, for
onward sale to licensed BIDECs.
10. BIDECs buy directly from BOST with cash and or a letter of credit (guarantee) from a
reputable financial institution.
11. BOST and the National Petroleum Authority (NPA) ensure that the cedi proceeds from
the sale of imported petroleum products will be collected and deposited with a
collection bank in favour of BoG. The collection bank is required to transfer collected
funds into BoG’s G4O proceeds account within 48-hours which is then used to fund the
next cycle of gold purchases.

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Pricing of Products:
12. To ensure that the price of petroleum products imported under the G4O programme
reflects at the pumps to benefit the consumer, the NPA will regulate the prices of these
products in the interim to correct market failure until the policy matures.
13. NPA will work with BOST to negotiate prices with the international oil traders to
ensure that the landed cost of products procured under the programme are always
competitive. NPA will approve the IOTC that will be selected to supply products to
BOST under the programme based on the competitiveness of the offers made by them.
BOST will sign supply contracts only after approval has been granted by the NPA.
14. The price at which BOST will sell the products to BIDECs will be approved by the
NPA. The price at which the BIDECs will sell the products to Oil Marketing Companies
(OMCs) will also be approved by the NPA.
15. The applicable exchange rate for pricing the products supplied under G4O will be based
on the average rate at which the gold was purchased from the licensed gold exporters
by BoG.
16. The NPA will put measures in place to ensure that OMCs that lift products supplied
under the G4O programme pass the price on to consumers accordingly. In this respect,
BIDECs and OMCs who lift and supply G4O products will sell at the ex-refinery and

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ex-pump prices that will be determined by the NPA. If there must be a comingling of
products supplied under G4O and other sources, the ex-refinery and ex-pump prices
will be computed using a weighted average.
17. All BIDECs and OMCs who wish to purchase products under the G4O programme will
be required to sign off an undertaking confirming their willingness to comply with the
terms and conditions for partaking in the purchase and sale of G4O products.
18. To ensure that the impact of the G4O programme on ex-pump price will be significant
and effectively monitored, the number of BIDECs and OMCs who will be permitted to
lift G4O products will be controlled.
Payment Structure:
19. BOST will be required to pay for products supplied to it under G4O into an Escrow
Account at BoG within 60 days of receipt of products from the international oil traders.
20. BIDECs will be required to pay for products procured from BOST within 15 days of
loading. Payment for the products will either be on a cash basis or with a 15-day letter
of credit (LC) from reputable commercial banks.
21. BOST will be required to provide BoG with copies of the LCs from BIDECs for
verification and to give BoG the assurance that receipt of payments will be made on
agreed dates.
Laycan Allocation for Product Imports:
22. The NPA will ensure that adequate laycan slots are allocated to BOST to import
products under the programme.
23. NPA will advise BOST on the projected demand on a monthly basis.
Date: 3rd February 2023