IMANI got it wrong,Energy Minister says about Aker oil discovery
The Minister of Energy, John Peter Amewu, has disputed allegations by a senior Vice-President of IMANI,Mr Kofi Bentil, that Ghana risks suffering a revenue loss of about $4.8 billion if an agreement with Aker Energy is not renegotiated as a matter of urgency.
According to the minister, the information put out by IMANI Africa on the need for the government to take immediate steps to negotiate the petrolum agreements on new oil deposits that had been discovered by Aker Energy, a Norwegian company, in commercial quantities in Deepwater Tano Cape Three Points (DWT/CTP) block, offshore Ghana, was baseless.
At a press conference in Accra yesterday to react to an earlier press conference held by IMANI, Mr Amewu said: “It is curious how IMANI came by the conclusion that Ghana risks losing $30 billion if the government does not negotiate a new petroleum agreement with Aker Energy.”
“There is no basis for a new petroleum agreement.
This is because the work that was done by Aker Energy formed part of an appraisal programme based on the existing petroleum agreement,” he said.
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The work, which involved the drilling of Pecan 4a, Pecan South and Pecan South East wells, was part of the appraisal programme submitted by Hess Oil and inherited by Aker Energy and partners.
Mr Amewu said the work had to be postponed for two-and-a half years as a result of the provisional ruling of the Special Chamber of the International Tribunal of the Law of the Sea (ITLOS), which placed an injunction on new drilling activities within the disputed area part of which was the Pecan field.
Mr Amewu said the provisional ruling, which was delivered on April 25, 2015, affected 69 per cent of the current DWT/CTP contract area and parts of other contract areas.
“As a country, we operate within the laws governing petroleum agreements, therefore, any petroleum find when produced will be shared according to the terms of the application of petroleum agreement,” Mr Amewu said.
He said the DWT/CTP Petroleum Agreement (PA) provided a crude oil sharing mechanism in addition to other benefits such as taxes, of which under the existing agreement, Ghana’s share was estimated at about 55 to 60 per cent of the net oil produced.
“It is important to state that these benefits are spread over the field life. Therefore, for anybody to contend that these were exploration wells drilled outside the exploration period, hence any petroleum find from these works require a new petroleum agreement with new terms is grossly misinformed,” he added.
He said the finds from those appraisal wells drilled just confirmed the real extent of the original Pecan discovery, saying “that is why their names are Pecan 4A, Pecan South 1A and Pecan South East 1A”, showing that they were related.
The Energy Minister said it was not true that Aker Energy had unilaterally determined in its plan of development when it would cease production without permission from the government.
He said the allegation that Aker had extended the period of the petroleum agreement from 2036 to 2049 could only be done by Parliament.
He said the think tank’s attempt to relate the South Deep Water Tano (SDWT) Petroleum agreement, commonly known as the AGM block, to the current Aker Energy project was also misleading, if not mischievous.
The minister said it was disappointing that IMANI had acted the manner it had in the matter, especially when there had been an engagement with the think tank a few weeks ago on those matters.
Aker Energy acquired the 51 per cent stake in an earlier well in the area found by Hess Oil, another Norwegian company.
Hess Oil operated under a petroleum agreement which the government of Ghana signed in 2006, which granted the company seven years within which to undertake oil exploration in the contract area.
That exploration period, however, ended in 2013.
Aker Energy announced earlier this year that it had discovered commercial quantity of oil in the Pecan well in the DWT/CTP block offshore in the Western Region.
According to the company, initial work done revealed that its Pecan well in the block held an estimated 450 to 550 million barrels of oil.
The company projected that the volume of oil in a plan of development in the next appraisal wells could increase to between 600 and 1,000 barrels of oil.
In a related development, Fueltrade Limited has issued a statement to debunk the allegation by IMANI Africa in respect of the Deepwater Tano Cape Three Points (DWT/CTP) block.
According to the release, it said the Vice-President of IMANI, Kofi Bentil, asserted that Dr K. K. Sarpong and his family were the owners of Fueltrade Ltd.
The statement said IMANI Africa and Kofi Bentil advanced that claim apparently in support of wrongdoing they were alleging in respect of the DWT/CPT project.
“In particular, IMANI and Kofi Bentil stated that it was ethically wrong for Fueltrade Ltd, a company allegedly owned by Dr K. K. Sarpong and his family, to be a partner on the DWT/CTP project,” it said.
However, the statement said, “the clear but unfortunate intention of IMANI Africa and Kofi Bentil was to drag Fueltrade Ltd into its accusations of involvement in unethical business practices”.
“Fueltrade Ltd wishes to state that its shareholders are Messrs Chris Chinebuah and Dzifa French Cudjoe, who have the full legal and beneficial interest in the company,” it said.
It stated categorically that Fueltrade was not legally or beneficially owned by Dr K. K. Sarpong and/or his family.
The statement said IMANI Africa and Kofi Bentil had ample opportunity, before the press conference, to verify the ownership of Fueltrade Ltd.
They could have verified ownership by engaging directly with Fueltrade Ltd, or by conducting a search into the easily accessible records at the Registrar-General’s Department.
It said Fueltrade Ltd was convinced that IMANI Africa and Kofi Bentil did not undertake any verification because they set out to act and speak with malice and/or reckless disregard for the truth in order to achieve a collateral purpose.
“In pronouncing our company as unethical and as being involved in unethical business (based on untruths) and for ulterior motives, IMANI Africa and Kofi Bentil have caused embarrassment and reputational damage to us.
“We have instructed our lawyers to make a demand for a retraction and apology from them.
If no such show of remorse materialises, we will take all steps to protect our business and hard-earned reputation,” it added.