Government cautioned on petroleum deals

The Government of Ghana has been cautioned on how it is handling the issues involving the proposed unitization between Eni’s Sankofa Gye Nyame (SGN) Field and Springfield’s West Cape Three Points’ (WCTP) Afina discovery as well as the exit of ExxonMobil from Ghana.

The Africa Centre for Energy Policy (ACEP) said the negative press associated with these issues has the potential to undermine the progress made over the years to encourage investments into Ghana’s upstream petroleum sector.

This is further worsened by the current global context of the energy transition, which is engineering a significant shift from fossil fuel investment to low carbon energy sources.

AVCEP said in a statement that the positive response of major oil producers and investors to the transition is promoting alternative energy sources that are significantly suppressing the demand growth for fossil fuels. A scan of the strategy of major oil producers shows a clear transition path to becoming energy companies through extensive Research and Development (R&D).

“The shift is shrinking the available capital for investments in new exploration activities in the oil industry and generating extreme competition for limited exploration funds. Attracting investment, therefore, requires a positive, assuring and less risky political environment.

“This environment can be achieved through stakeholder collaboration and transparent engagements that reduces negativity and its attendant impacts on investment attraction.

“ACEP’s statement on these developments is a cautionary call on government and stakeholders to act right and preserve the investment climate of the oil industry.”

Proposed unitization between SGN and Afinab

“ACEP has followed communication from the Ministry of Energy directing Eni and Springfield to unities their fields.

“This directive was based on GNPC’s assessment of the petroleum system on the two fields, informing the corporation’s conclusion that the Afina discovery straddles the SGN production field. However, ACEP has sighted a subsequent report by Eni, which strongly disagrees with the conclusions made by GNPC.

“In the absence of clarity and public communication from the government on its position, the local media space has been hijacked with pressure to accelerate the implementation of the unitization directives.

“Within the international press, the reportage suggests an arbitrary imposition of unitization on the two parties.”