By William Wallis in London
International banks have delayed a decision on fin ancing an $875m oil-processing vessel in Ghana following revelations about a subcontract linked to a former state official. The disclosures could complicate Ghana’s journey towards becoming an oil producer.
A consortium of banks led by the International Finance Corporation, the World Bank’s private-sector lending arm, called for a fresh round of due diligence after Japan’s Mitsui Ocean Development & Engineering revealed last month that it had agreed to pay fees up to $5m (€3.8m, £3.2m) to a consultancy company part-owned by Tsatsu Tsikata, the head of the Ghana National Petroleum Corporation from 1988 to 2000.
The World Bank’s Multilateral Investment Guarantee Agency is suspending political-risk cover pending the outcome of the review. A person in the banking consortium said that should evidence of “influence peddling” be uncovered, complications would arise for the development of the largest recent oil discovery in the Gulf of Guinea.
Modec, which in 2008 won the contract to provide the vessel that will collect and process oil from the Jubilee oilfield in 2008, confirmed that inquiries were taking place but said it saw no reason to believe the project would be disrupted.
Mr Tsikata is an influential figure in the National Democratic Congress, which returned to office in December 2008. However, the deal between Modec and Stratoil, the company he part owns, was made when he was a private citizen. The NDC had been out of office for seven years and Mr Tsikata was on the point of being jailed for his part in a loss-making rice project after a long trial. He was released just before power changed in 2009.
Allies of the Oxford-educated lawyer said it was absurd to suggest he could have influenced a transparent tender process at a time he was being hounded by the incumbent government.
Stuart Sutton-Jones of Stratoil said the company had provided consulting services to Modec for the preparation of their tender. This included advice on financing from the IFC, the African Development Bank and others. Stratoil also introduced the Japanese company to equity providers in the Middle East and carried out “extensive economic modelling work for the project”, he said.
Mr Tsikata is respected by allies as a patriot, who as head of the state oil company laid the foundations for the discovery of oil. However, opponents see him as a Svengali-like figure with tentacles reaching into many areas of the state.
The timing of the disclosure is awkward, with the government under mounting pressure to resolve a separate dispute with Kosmos, the Texan company, over its attempt to sell its stake in the Jubilee field to ExxonMobil. Mr Tsikata is known to oppose the ExxonMobil deal.
Aidan Heavey, chief executive of Tullow Oil, a lead partner in Jubilee, said oil production would begin on schedule later this year. “We went through a very straightforward and transparent process and Modec won the bidding by a mile. This is not going to hold up the production of first oil,” he said.
An IFC spokesman said that due diligence on such a project was routine and did not necessarily imply a problem. But a person in the banking consortium said: “This is not the sort of project we want to walk away from. Having said that, what you do when an issue like this comes up is you look into it further.”
