Court of Appeal dismisses Sankofa Oil Field application

BY: Daily Graphic
An oil rig (File photo)
An oil rig (File photo)

The Court of Appeal has dismissed an application by the operators of the Sankofa Oil Field which sought to stay the execution of the judgment delivered by the High Court pending the determination of an appeal filed in respect of the ruling.

The High Court had ordered operators of the Sankofa Oil Field to preserve 30 per cent of all the revenues which would be accrued from the field until the final determination of a legal dispute relating to it.

A three-member panel of the Court of Appeal, presided over by Justice Barbara F. Ackah-Yensu, in a ruling, held that no exceptional circumstance had been established to warrant the grant of stay of execution.

Other members of the panel are Obeng-Manu Jnr and Justice Richard Adjei-Frimpong.

The court further awarded GH¢8,000 each against the operators (Eni Limited and Vitol Upstream Limited).

Revenue

In June this year, the Commercial Division of the High Court, presided over by Justice Mariama Sammo, upheld in part an application by Springfield Ghana Limited, the plaintiff in the legal dispute, and further ordered the operators (Eni Limited and Vitol Upstream Limited) to preserve 30 per cent of their revenue into an account agreed by all the contesting parties.

Dissatisfied with the trial court’s decision, the operators launched an appeal to contest the ruling.

They further filed the application for stay of execution at the appellate court pending the determination of two separate appeals filed to contest the High Court’s decision.

However, the Appellate court in its ruling said: “We are persuaded better by the arguments that lead to the position where the order of the trial court ought not for the time being, be disturbed pending the determination of the substantive appeal.”

Dispute

The disputed Sankofa Oil Field is part of the Offshore Cape Three Points (OCTP), an area located off the coast of Western Ghana, with about 500 million barrels of oil reserves, and 40 billion cubic metres of gas. Eni, Italian multinational oil giant, is the lead operator.

On the other hand, Springfield is the lead operator in the West Cape Three Points (WCTP) with the Afina Field.

It is the case of Springfield that various analysis and tests had shown that the accumulation of petroleum in the Sankofa field extended to its contract area (Afina Field).

Unitisation

In April 2020, the then Minister of Energy, Mr John Peter Amewu, in accordance with Section 34(1) of the Petroleum (Exploration and Production) Act, 2016 (Act 919), directed ENI and Springfield to execute a unitisation with respect to the Sankofa field in the OCTP and Afina discoveries in the WCTP contract areas.

Springfield argues that the defendants were dragging their feet and had failed to comply with the directives of the minister.

In its substantive suit, Springfield is seeking an order from the court directed at the defendants to comply with the minister's directive, and enter into an agreement with it to make the Sankofa and Afina fields a single unit.

It also wants the court to direct the defendants to cooperate with the plaintiff to develop the two fields into one.

Springfield is further seeking an order from the court directed at the defendants to account for all the revenues accrued to them from the Sankofa Field since 2009 when exploration commenced.

The plaintiff further wants the court to order the payments of all revenue it deserves from the Sankofa Field.