The Minority in Parliament has described the decision by Exxonmobil to withdraw its interest in Ghana’s Deep Water Cape Three Point as a sign of lack of confidence in the Nana Akufo-Addo-led government.
In a letter to Ghana’s Energy Minister, Dr. Matthew Opoku Prempeh, and other stakeholders including the CEO of the Ghana National Petroleum Corporation (GNPC), Dr. KK Sarpong and Egbert Faibile Jnr., the CEO of Petroleum Commission, Exxonmobil said it is unwilling to enter an extension of the contract originally signed in 2018.
“EMEPGL hereby notifies the Republic that it has determined not to enter into the First Extension Period, and hereby voluntarily surrenders and relinquishes one hundred percent (100%) of its rights in and to the DWCTP Contract Area. EMEPGL also confirms that it hereby resign as Operator for the DWCTP Block and that it has fully performed the relevant Minimum Work Obligation under the Petroleum Agreement. The above is without prejudice to the EMEPGL’s accrued rights,” excerpts of the letter read.
ExxonMobil did not give detailed reasons for its decision.
Reacting to this the Minority in a statement signed by John Abdulai Jinapor Ranking Member – Mines and Energy Committee said the decision is “disturbing.”
The Minority also described as “unfortunate” that despite President Akufo-Addo inheriting a well-functioning and promising oil sector from his predecessor with three producing fields (i.e. Jubilee, TEN and Sankofa Gye Nyame), the sector has continued on a downward trend “mainly due to underhand dealings and a high level opacity in the sector.”
The statement said: “With Ghana’s oil production set to decline if no new production capacities are added, this government must give priority to the sector and ensure that it attracts the needed investments through an open and transparent process; and within the remits of acceptable best practices in the oil and gas industry in order to boost the country’s oil production capacity.”
Below is the Minority’s full statement:
WITHDRAWAL OF EXXONMOBIL FROM GHANA A CLEAR SIGN OF LACK OF CONFIDENCE IN THE AKUFO-ADDO’S GOVERNMENT.
Tuesday 1st June 2021.
The Minority in Parliament has noted with great concern the decision by ExxonMobil to relinquish its interest in the Deep Water Cape Three Point (DWCTP) block in Ghana. Even more disturbing is the apparent threat by other major oil companies to equally abrogate various petroleum agreements they have with this government.
It will be recalled that in 2018, ExxonMobil entered into a petroleum agreement with Ghana where a ceremony was organized at the Flagstaff House under the supervision of President Akufo-Addo contrary to the norm where Ministers of Energy supervises such programs.
This was after the NPP Government and its majority members in Parliament rail-roaded the agreement with haste despite vehement opposition from the Minority on certain key aspects of the agreement which we believed was inimical to the state.
It will be recalled that the Minority side and some Civil Society Organizations raised key and cogent arguments against certain provisions in the Agreement but just like the Agyapa, PDS and AMERI deals, this Government completely refused to heed to our good counsel.
Today, Ghanaians have to bear the consequences of the hasty decision by the Akufo-Addo-led government to approve the deal with the shocking news of the withdrawal by ExxonMobil from the Agreement.
It is unfortunate that despite President Akufo-Addo inheriting a well-functioning and promising oil sector from his predecessor with 3 producing fields (i.e Jubilee, TEN and Sankofa Gye Nyame), the sector has continued on a downward trend mainly due to underhand dealings and a high level opacity in the sector.
With Ghana’s oil production set to decline if no new production capacities are added, this government must give priority to the sector and ensure that it attracts the needed investments through an open and transparent process; and within the remits of acceptable best practices in the oil and gas industry in order to boost the country’s oil production capacity.
In 2018, government organized the so-called e-Block licensing rounds which were publicized around the world. It was subsequently reported that 3 companies won blocks from the tender, however, to the surprise of industry players, no significant progress has been made to award the blocks to ensure the commencement of exploration activities.
Thanks to the good leadership of President John Mahama and the NDC, the country can boast of 3 oil producing fields in Ghana today (Jubilee, Sankofa and TEN fields).
The most unfortunate news is that thus far, not a single oil field has since been added over the past 5 years although the existing oil fields are declining in volumes as we continue with production.
From this latest developments, it is becoming obvious that Ghana is losing its place as a preferred investment destination in the petroleum sector within the sub-region under this government.
We are therefore calling on the Akufo-Addo’s government to sit up and put the interest of the country above all parochial and personal interest as a matter of urgency.
Ghana certainly deserves better than this.
Thank you.
John Abdulai Jinapor
Ranking Member – Mines and Energy Committee
