Business News of Fri, 16 Feb 20185
Government pursues 'aggressive' oil exploration campaign
Deputy Minister of Energy, responsible for Petroleum, Dr. Mohammed Amin Adam, has disclosed that government has decided to pursue an Aggressive Exploration Campaign in a bid to safeguard reserves and sustain production in the upstream oil and gas sector.
Speaking to journalists at the launch of the Petroleum Register, he said: “Coming into government we realised that we were faced with a future that will not see the sustainability of the oil and gas industry because we are not making new discoveries yet we are producing from the reserves that we have made some time ago, which means that, we are depleting these reserves without replacing them.
So, what we have decided to do, is to change our strategy for developing the upstream sector. Our strategy now is what we call, an Aggressive Exploration Campaign,” he said.
The minister revealed that government was ready to pursue “anything” that will accelerate the process of finding oil to increase production and subsequently generate more revenue.
He explained that one of the objectives of pursuing an aggressive accelerated strategy in exploration is to do business with large multinational companies, that have a track record of success and experience in the sector.
“…already as you know we have been able to get Exxonmobil, the largest listed oil and gas company in the world to come into Ghana.”, he added.
A recent agreement with Gazprom, the world’s largest producer of gas accounting for 11% of the world’s gas, is also a step in this direction. The Gazprom deal with Ghana is the second biggest Liquefied Natural Gas (LNG) Supply contract in the company’s portfolio, so far.
“We have signed an agreement for Gazprom to come into Ghana and supply LNG. And so we are targeting the major companies that have the money, that have the technology that have the track record, to help us accelerate our road to finding oil,” Mohammed Amin Adam said.
The minister added that, furthermore, a lot of seismic work was being carried out by the Ghana National Petroleum Corporation (GNPC) on the onshore Voltaian basin under its 5-year initial exploration programme from 2015 – 2019, backed by a directive from President Nana Addo Dankwa Akufo-Addo.
“I can tell you the preliminary results we have got is very positive and therefore if everything goes well, we are on our way to finding oil onshore,” he said.
President Akufo Addo himself, in his State of the Nation address, stated that “It is good to hear that, that directive appears to be yielding dividends, as GNPC, from the results of its pilot survey in the Voltaian basin, has established the presence of a working petroleum system. I hope that, eventually, there will be something big for us to cheer about.”
Pursing the aggressive exploration strategy does not end with these developments. Government is proposing to also execute the first ever bidding round in the country’s history as a competitive means of allocating new oil blocs to deserving and capable companies.
The competitive bidding process will ensure that only the best and “serious” companies, will come into Ghana to do business. The aim is to find more oil to replace depleting reserves and increase production to ensure sustainability of the industry over a longer period of time.
Aside the laid-out roadmap to achieving the proper execution of the strategy, government is in the process of developing regulations to guide in the open and competitive tender. They expect to complete preliminary work on the policy document and lay it before parliament by end of the first quarter of this year.