Bright Simons, a global thought leader, has raised red flags over the planned acquisition of stakes in Aker Energy and AGM Petroleum Ghana oil blocks by the Ghana National Petroleum Corporation (GNPC) saying it’s mindboggling.

In an article analyzing the developments, Mr. Simons rubbished the GNPC’s reasoning for entering into the deal.

He said the GNPC’s explanation that it wants to become a major operator in the production of oil within Ghana was “plain nonsense” as it has had past opportunities.

Mr. Simons further noted that the GNPC, via subsidiaries, had not proven to be capable of bearing fruits in operations at South Deep Water Tano (SDWT) and the Offshore South West Tano Block (OSWT).

“Suffice to say that GNPC’s stints at operatorship of both OSWT and SDWT have been a technical disaster of sheer unproductivity.”

Instead of further exploration, Mr. Simons said GNPC ought to be addressing “the poor governance and broken management of the petroleum sector.”

Aker Energy and AGM Petroleum Ghana are controlled by Norwegian billionaire Kjell Inge Rokke, who Mr. Simons said: “has successfully plotted a windfall of as much as $1 billion after patiently cultivating the Ghanaian political elite for more than a decade.”

Find Mr. Simons article here

Background
GNPC, through its GNPC Explorco, is allowed to participate in the upstream petroleum sector and it plans to purchase a 70 percent stake in the South Deep Water Tano (SDWT) operated by AGM Petroleum Ghana Limited and a 37 percent stake in the Deep Water Tano/Cape Three Points (DWT/CTP) operated by Aker Energy Ghana Limited.

The company will form a joint operating company with the two entities and acquire the said stakes at different agreed prices.

GNPC has already secured Cabinet approval and is seeking $1.65 billion loan.

The company has justified the deal, saying such a partnership with the two entities is critical because of the exiting of oil majors from the country.

It said it needed to build its capacity and take up a large part of the exploration activities before Ghana’s oil reserves hit a level of terminal decline.