Oil and gas sold short

The Africa Report - - COUNTRY FOCUS -

FROM QUIET BE­GIN­NINGS, with first oil from the Tul­low-run Ju­bilee field in De­cem­ber 2010, pol­icy-mak­ers in Ghana’s petroleum in­dus­try spoke of fend­ing off the threat of the ‘re­source curse’. In­ter­na­tional ex­perts de­scended on Ac­cra, ad­vis­ing that Ghana should choose ‘Nor­way over Nige­ria’ when it came to a de­vel­op­ment strat­egy. It hasn’t worked out like that. Ju­bilee’s de­vel­op­ment was marred by a dis­pute over pref­er­en­tial terms given to Kos­mos En­ergy in part­ner­ship with two mi­nor­ity share­hold­ers from the New Pa­tri­otic Party (NPP), the rul­ing party at the time. Gov­ern­ment rev­enue from oil and gas amounted to $444m in 2011; it was up to $541m the fol­low­ing year. Stag­na­tion fol­lowed, due to high ex­plo­ration costs and po­lit­i­cal un­cer­tainty. Op­po­si­tion­ists ac­cused John Ma­hama’s Na­tional Demo­cratic Congress (NDC) gov­ern­ment of ne­go­ti­at­ing its own opaque deals and rush­ing through the Petroleum (Ex­plo­ration and Pro­duc­tion) Act in 2016 on terms that left Ghana with less than 20% of to­tal oil and gas rev­enue. The launch in Au­gust 2016 of Tweneboa Enyenra Ntomme in Tul­low’s Deep­wa­ter Tano block seemed to of­fer a rev­enue boost. Ne­go­ti­a­tions on the Eni/vi­tol-backed Sankofa oil and gas field, on the other hand, were shrouded in con­tro­versy. In­dus­try ex­perts said Ghana, ad­vised by the In­ter­na­tional Fi­nance Cor­po­ra­tion (IFC), had mis­han­dled the ne­go­ti­a­tions for the $7.9bn deal. The new NPP gov­ern­ment promised to rene­go­ti­ate the deal but no de­tails have emerged in pub­lic. The lat­est ven­ture, Spring­field, in the West Cape Three Points block, is ex­cit­ing Ghana’s in­dus­try-watch­ers. It is man­aged by the young oil trader Kevin Okyere, known for his deals in Nige­ria in the era of oil min­is­ter Diezani Ali­son-madueke, and is the first ex­plo­ration site wholly owned by Ghana­ians.

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