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Here’s why oil blocks 5 and 6 were reserved for direct negotiations

Thu, 25 Nov 2021 Source: www.ghanaweb.com

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Oil blocks 5 and 6 remains untapped

Direct negotiation on block 5 and 6 not to cut people off

Only experienced people in deep water will be given the chance to explore blocks 5 and 6

Director of Petroleum at the Ministry of Energy, Benjamin Kwame Asante, has disclosed why blocks 5 and 6 of Ghana’s oil were reserved for direct negotiations and not open for licensing round.

According to him, these blocks are in deep water hence, requires people who have experience in deepwater exploration to negotiate for its bidding.

He furthered that, blocks 5 and 6 bidding needs people who are financially mature to take over as works on them is financially challenging.

The director of petroleum at the ministry of energy stressed that the reason for reserving the aforementioned blocks was not to cut people off and award contract to their “favourite” company.

Speaking at a round table discussion on upstream petroleum licensing and contracting in Ghana on Thursday, November 25, Mr Asante said, "They were in deeper waters, they have complex geology, they were financially challenging because they needed more money to work in that regime of deep water…it’s not a matter of how many wells you have plugged, or how long you have been operating. If you are not a deep water operator and you don’t have that experience, you can’t just go there."

As part of measures to improve good governance in the upstream oil and gas sector, Ghana enacted the Petroleum Exploration and Production Act 2016, (Act 919) to replace Petroleum Exploration and Production Act 1984 (PNDC 84).

This Act has been in operation for over three decades.

Government launched the country’s first oil bid and licensing round in 2018 through 2019 leading to award blocks and commencing negotiations for the grant of petroleum agreements to successful bidders in 2019/2020.

Source: www.ghanaweb.com
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