Tsikata Hijacks Ghana’s Oil

Just three years ago, Ghanaians were getting by with the revenues that Gold, Cocoa, and other minerals provided, which were not much to turn their country into an investment Mecca. Today, thanks to the entrepreneurial efforts and persistence of a Ghanaian diasporas, Ghana is a bona fide oil destination. As expected, Ghanaians have high hopes, and rightfully so. Managed well, the Jubilee Field could yield over one billion barrels of crude discovery can transform the nation into its aspired middle income status. But if the current developments are anything to go by, Ghanaians are in for the shock of their lives as jealousy, vindictiveness, corruption, tribalism and lack of foresight threaten to derail sound management of the oil discovery.

There is a well-laid structure that coordinates activities of the Ministry of Energy, Ghana National Petroleum Corporation (GNPC), and the Parliamentary Committee on Energy to ensure balanced management of the emerging oil industry. The problem is that this structure has been circumvented by non other than Tsatsu Tsikata, a convicted felon who has neither ever been voted for by any constituency nor currently appointed in any official capacity by the government. No decision of significance is ever made without Tsikata’s approval. For there to be a legislature and for one individual with no official portfolio to command such total control over an asset as vital as oil and gas makes a mockery of our democracy.

How can a Memorandum of Understanding (MOU) be reached between GNPC and China when Honorable Moses Asaga, the Parliamentary Committee Chairman on Energy is kept completely in the dark? In addition, GNPC has signed a $1 billion gas processing agreement with Oranto Company of Nigeria without parliamentary involvement. Similarly a plan of development with the Jubilee partners was also executed without Parliamentary involvement. As if that was not bad enough, the sale of Kosmos’ shares in the Jubilee field is proceeding in secrecy in a democratic environment where checks and balances should guide all governmental activities.

All these circumvention of laid-down procedures are made possible by a known modus operandi of Tsatsu Tsikata’s. Most of the leadership of all the significant energy sector entities is populated by Ewes with Akan names, who are well-known protégés of Tsikata. They are: • Nana Asafo Adjei (Ewe), CEO of GNPC • Thomas Manu (Nothern Volta), Chief Technical Manager of GNPC • Dr. Akoto (Ewe), CEO of Bulk Oil Storage and Transport (BOOST) • Mr. Ampofo (Ewe), CEO of Tema Oil Refinery (TOR) • Kwabena Donkor (Guem) Deputy Minister of Energy

With all these protégés in place, Tsikata has managed to render the Minister of Energy completely powerless to make any decisions on his own. Tsikata has thus been able to develop a personality cult that discourages his protégés from making independent assertions. This controlled environment now makes it possible for him to further his known socialist agenda, which runs into conflict with western companies. No wonder Dallas, Texas based Kosmos and Global giant ExxonMobil are experiencing unnecessary difficulties Recall that during the PNDC/NDC era, due to this same penchant for harassing foreign investors again under the guise of seeking Ghana’s interest, many companies stayed away because they deemed Ghana a business unfriendly environment. We all know the hardship that the resulting lack of capital and the declining cedi unleashed on Ghanaians. Today the same chatters are developing around the world.

ExxonMobil will not succumb to abusive governments because it does not have to. Not when many countries spend enormous resources to attract proven oil producers such as ExxonMobil. Further, United States’ Foreign Corrupt Practice Act constrains the oil giant when it comes to bribing foreign government officials. Thus, this sale of Kosmos’ stake to ExxonMobil would generate no bribery potential for government officials. Could that be the reason why they oppose it so vehemently?

China, on the other hand, comes cheap. In addition, they are very willing to dole out brown envelopes to officials. But when it comes to proven resources to produce our oil, China’s track record is questionable at best. In fact, they bailed out during the exploration phase due to a combination of a lack of technological know-how and their assessment that investing in oil in Ghana was too risky Are these the same interests on whom Tsikata is willing to stake our oil future? They say in life you get what you pay for. We will all witness what going for cheap will end us.

But questions still remain around Tsikata’s involvement and approach. Where is Ghana going to find the money to finance Kosmos’ stake worth $4 billion and counting due to its continuing exploration and discovery? What national assets are being put up as collateral? Already it is on record that Ghana is in default on meeting her financial obligation associated with the production cost of the available 3.5% in the Jubilee Field. Has Tsikata’s hijacking of the oil industry created a stalemate that threatens the oil production timeline of late 2010? Do Ghanaians have to wait for needed developments that the oil revenue would make possible just because a convicted felon wants to have his way?

Tsikata’s way has always been money in his pocket rather than to Ghana’s coffers. Clearly his plan is to buy Kosmos’ stake on the cheap so that he can turn around to use his own company Stratoil to sell to the Chinese at a higher price and pocket the profit, which he cannot make under the current sale agreement with ExxonMobil. Yet he continues to make deceptive claims that he is negotiating a better deal for Ghanaians

Ever since our oil discovery was announced in June of 2007, Ghanaians have been warned to learn from the mistakes made by other oil producing developing countries. If we heed that advice, we will all benefit from this God-given asset. Unfortunately, it appears we have begun more disastrously than even Nigeria and Angola.

To avoid the pitfalls that befell our sister countries, we as Ghanaians need to challenge our elected leaders to represent our interest else our democracy stands the risk of being hijacked by a few self-serving socialists. Despite the fact that Tsatsu Tsikata has a record as a terrible business decision maker, the Mills administration seem to have ceded all the critical decisions regarding our oil and gas industry to him and so far he has succeeded in enhancing his long standing reputation in the oil and gas industry as ignorant, arrogant and reckless. It is time for all of us, especially, our elected representatives and NGOs to ask the following critical questions of Mills and Tsatsu Tsikata:

• What kind of national asset or treasury are they using to secure the $4 billion dollar loan they are seeking to buy the reserves from Kosmos • Where are they going to find the money to pay for the development and production of the field, if they are already defaulting on the payment of our 3.5% current paying interest • Has Tsatsu Tsikata gone through any approval process with all the relevant government agencies, including the minority parties, to make a compelling business case for why Ghana should risk $4 billion dollars to acquire an asset that GNPC has no experience whatsoever to manage • More importantly, why is Tsatsu Tsikata the one person making these decisions on behalf of all of us as Ghanaians, although he holds no official capacity? Could it be that he is deliberately doing so to avoid being responsible for all the potential damage he is causing the nation, both financially and image-wise

As we ask these questions, we must also be mindful of the fact that everything that Tsatsu Tsikata exemplifies has been tried and has failed elsewhere. Tribalism has resulted in conflicts beyond human imagination. Socialism failed so badly that the Soviet Union had to abandon it. Personality cultism never succeeds in an increasingly system-based world. And certainly greed and selfishness amidst such abject poverty in Ghana can only breed chaos. Tsikata’s role in Ghana’s oil and gas development is as undermining as it is disruptive and it is long past time that we put a stop to it. His tactics have alienated many highly qualified Ghanaians both at home and abroad who could contribute to a better-run oil industry in Ghana.