Renegotiation of AGM petroleum agreement benefited Ghana – Minority told

The Government of Ghana has dismissed claims by the minority that the AGM petroleum agreement was renegotiated in an opaque manner.

John Jinapor, former Deputy Minister of Power and Member of Parliament for Yapei Kusawgu, at a press conference in Accra accused the government of renegotiating the AGM Agreement under bizarre and opaque circumstances.

He said also that “In the renegotiated agreement, GNPC’s additional participating interest was reduced from 15% to 3%. As if that was not enough Explorco’s commercial interest of 24% was dropped to Zero”.

But responding to this claim in a statement, the Minister of Energy, John Peter Amewu said : “The AGM Petroleum Agreement was signed under the NDC Government. However, the company could not meet its minimum obligations. Following the acquisition of the company, the new owner presented a request for renegotiation to provide some incentives to support the prospects presented by the block, described as the deepest oil block in Ghana.

“This renegotiation is allowed under the petroleum law and in the Agreement itself.

“Government granted some incentives, which resulted in the company drilling two mandatory wells and an additional well. The increase in investments led the company to make oil and gas discoveries in 2019. The incentives provided have paid off as the intended objectives have been achieved.

“The Government also took advantage of the request for renegotiation to evaluate the financial position of GNPC in relation to its ownership interest in the block. Given its many commitments and the need to prevent it from being over-exposed, GNPC decided to divest part of its paid interest.”

The statement added : “Curiously, the NDC was economical with the truth by concealing from Ghanaians that the NPP government also renegotiated Ghana’s free carried interest from 10% to 15%; and local participation from 2.5% to 5%. This is intellectual dishonesty.

“Negotiation is give and take. In our view, we had a net gain. Additionally, crude oil discoveries have been made under this renegotiated contract.

“This also means that Ghana’s take has increased without the requirement to invest about a billion United States Dollars the country would have been required to do under the previous Agreement. This has reduced GNPC’s exposure.”