Business News of 2014-04-21

ACEP cautions gov’t over oil block sale

The Africa Centre for Energy Policy (ACEP) is worried that Ghana's oil and gas industry may be exposed to international ridicule following the alleged forging of the signature of the Minister of Energy and Petroleum by an employee of Miura Petroleum, an oil firm claiming the right of first negotiation over the Offshore Cape Three Points South (OCTPS) block in Ghana.

Miura Petroleum, in conjunction with its parent company Gondwana Oil Corporation, had recently stated that its assets in Ghana included the right to the offshore block about which it had begun negotiations with the government of Ghana.

However, in a press release by the Ministry of Energy and Petroleum, Miura has been accused of forgery in connection with the award letter and signature of the Minister of Energy and Petroleum, and denied ever awarding the right of first negotiation to Miura.

Two critical issues

Miura was the company originally awarded the right and has already bagged in US$1.5 million having sold majority shares to Gondwana. This means that Miura has already made a financial gain in respect of the transaction while Ghanaians are still far from any benefits associated with the oil resources of the country, according to the release.

The centre is also concerned that many other companies around the world may be holding letters with forged signatures allegedly from Ghana and taking advantage of Ghana's oil and gas industry to make money.

Gondwana Oil Corp has recently listed on the Canadian stock exchange to mobilise funds for its operations. The controversy, if proven, exposes other companies holding Petroleum Agreements from Ghana to serious risks in the international capital market.

According to the centre, “sources reveal that Gondwana used the said letter in its Listing statement to the Canadian Stock Exchange. If indeed the letter was forged, as we are being told, it will also amount to a deception of the Canadian Public and the resultant depletion of Ghana’s credibility in international commercial transactions”.

ACEP recently cited Miura Petroleum's claim to assets offshore Ghana as example of Ghana "giving away" juicy blocks to inexperienced and questionable oil companies and called for a moratorium on further licensing until the new Petroleum (Exploration and Production) Bill was passed.

“We strongly believe that the secrecy surrounding oil deals in Ghana is largely responsible for this alleged forgery and criminality. It is, therefore, no longer an option but a necessity for Ghana to adopt an open and competitive process for granting oil and gas concessions. Parliament must also invite public comments before approving Petroleum Agreements”.

The centre called on the government to award oil blocks to companies that had the financial muscle to finance the huge capital operations in the oil industry seriously.

“We wish to further alert the Ghanaian authorities to be careful of Ghanaians who have no good financial standing and who are determined to be used as ‘fronts’ for international companies using their Ghanaian identity to satisfy local content requirement,” the letter stated.