President John Mahama has for the first time admitted that a maritime boundary dispute with Ivory Coast had affected the development of the new Tweneboa-Enyenra-Ntomme (TEN) offshore oilfields.
"The maritime boundary dispute had impacted TEN development activities in the disputed area as the provisional measures order from the international tribunal included an order prohibiting new oil wells in the field," he said.
However, he promised that Ghana is committed to a peaceful resolution of the dispute.
"We remain committed to a peaceful resolution of this dispute, and we look forward to the final resolution of this matter sometime next year", he added.
President Mahama was speaking shortly after an opening ceremony for Ghana's second commercial crude oilfield in the western city of Takoradi.
8 Wells to commence production
TEN production commenced with eight wells, comprising four oil wells, three water wells and one gas injection well.
3 More wells to be completed in September
Three more wells – made up of one producer and two water wells –are expected to be completed by September to bring the number to 11.
The full TEN field development consists of around 24 wells, comprising a mixture of water injection, gas injection and production wells.
The remaining 13 wells will be drilled after the International Tribunal on the Law of the Seas (ITLOS) gives its final verdict on the boundary dispute between Ghana and Cote d’Ivoire next year.
Production at the TEN field expects to average around 23,000 barrels per day (bpd) in 2016, but will eventually reach 80,000 bpd if the ITLOS ruling favours and the remaining 13 wells are drilled to make the total wells 24.
TEN, with estimated reserves of 240 million barrels of oil and associated gas of 60 million barrels equivalent, is Ghana's second oilfield after the country's flagship Jubilee project, also operated by Tullow, which began in late 2010.
Revenue from TEN is significantly less than was first anticipated when the country launched the project in 2013, owing to the slump in world oil prices.
Oil revenue is vital as Ghana battles to meet conditions set by a three-year aid programme with the International Monetary Fund that aims to bring down inflation and the budget deficit, as well as stabilise the cedi currency.
ENI to open next year
Ghana hopes next year to open a third field, Offshore Cape Three Points field, operated by Italy's ENI.
President Mahama said indigenous small-scale businesses have received $1 billion worth of contracts from petroleum companies since the commencement of commercial production of crude oil in the country.
He said the award of contracts to local enterprises was in compliance with the country’s Local Content and Participation Policy, which had created over 7,000 jobs aimed at ensuring that the hydrocarbon resources benefited Ghanaians.
He said the oilfield would increase the country’s oil and gas assets and serve as an attractive investment destination for the country.
He said so far the partners had spent $4 billion on the exploration, development of the oil wells up to the production stage since May 2013, when the government approved the Plan of Development.
The President indicated that the project would increase jobs, strengthen the existing small-scale enterprises and make Ghana a significant player in oil and gas production in the West African sub-region.
The development of TEN oilfield was led by Tullow Oil and its partners; namely, the Ghana National Petroleum Corporation, Kosmos Energy, Anadarko and PetroSA.
The oilfield, which has 20 years lifespan, is located in the Deepwater Tano Basin block, 60 kilometres offshore and is expected to produce 76,000 barrels of oil and 50 million standard cubic feet of gas per day at peak production.
President Mahama said the field would not only increase the country’s oil revenues but also provide substantial gas reserves to the Atuabo Gas Processing Plant, which would in turn supply gas to the Aboadze power enclave for electricity generation.
Mr Aidan Heavey, the Chief Executive Officer (CEO) of Tullow Oil plc, expressed delight for the historic feat and said it would significantly increase the country’s petroleum revenues and create more investment and job opportunities.
Mr Emmanuel Armah-Kofi Buah, the Minister of Petroleum, said Ghana was fast becoming the preferred investment destination in the West African sub-region and that the necessary laws and legal frameworks were being put in place to protect the nation’s oil and gas industry.
Nana Kwesi Agyeman IX, the acting President of the Western Regional House of Chiefs, expressed gratitude to the government for the various infrastructure and social interventions in the region, and appealed for more of such projects to aid the food production activities there.
Shareholders in TEN project
The shareholders in the TEN project are Tullow – 47.185%, Ghana National Petroleum Corporation (GNPC) – 15%, Kosmos Energy – 17%, Anadarko Petroleum Corporation – 17%, and PetroSA - 3.815%.
<<Print>>