Industry related ..
State-run GNPC agrees its terms with China amid Jubilee rumours
Ghana signs up to support protocol
BARRY MORGAN, Accra
GHANA 's state-owned oil company Ghana National Petroleum Corporation (GNPC) and the Chinese National Offshore Oil Corporation (CNOOC) have signed a protocol covering financial and technical support for oil exploration.The deal, which comes amid speculation in Ghana that the two could join forces to buy Kosmos Energy's stake in the Jubilee oil project, was confirmed after a courtesy call on President John Atta Mills by the CNOOC chief executive Fu Chengyu.
Also in attendance was Ghana's Minister of Energy Joe Oteng-Adjei who stressed his ambition for GNPC to go beyond its "traditional finding and co-ordination role" and become active in exploration.
Ghana has yet to pass a proposed overhaul of its petroleum code and restructure national petroleum institutions, but Oteng-Adjei's remarks representthe firmest indication yet that the government aims to develop an indigenous and independent exploration and production skills base.
Fu Chengyu also highlighted the need for Ghana to assert its sovereign rights and "build its own oil company rather than depend on foreign investment." Mills stressed "the good ties between China and Ghana [and gratitude]that you've come at the time when we need your technical support," adding that his government would "create the right environment" for effective collaboration.
Environmental and human rights observers, such as Oxfam International, have long criticised Ghana's oil regime as discouragingly opaque. They argue that the current extractive industries transparency initiative should be applied to the nascent oil sector before the oil starts flowing, but this now seems unlikely.
Local non-governmental organisations continue to call on existing operators and the government to "publish what they pay" under Ghana's hybrid royalties-concession system.
Meanwhile, other foreign explorers are also keen to acquire Kosmos Energy's stake in the Tullow Oil-operated Jubilee field, believed to hold between 1.2 billion and 1.8 billion barrels of oil equivalent, and that of smaller participants Sabre Oil&Gas and the E O Group.
GNPC has said it wants to buy the 23.49% Kosmos stake in Jubilee but observers wonder how the cash-strapped parastatal or the government would raise a sum close to $5 billion. Adding to local speculation that CNOOC is poised to acquire the Kosmos stake in Jubilee, industry officials in Accra are this week openly linking Fu Chengyu's official visit to Finance Minister Kwabena Duffuor's admission on 18 September that Ghana is seeking a $2 billion concessional loan from Beijing.
At the same time, CNOOC confirmed last month that it was in the running to acquire the Kosmos stake and was ready to help Ghana realise its upstream ambitions.
Meanwhile, interest in available Jubilee equity has intensified among oil suitors amid growing awareness of heavy politicking within Ghana's new administration, keen to put its own stamp on the equity line-up.
The initial deadline for bid submissions was extended for one month until the end of August but this has now been "suspended", according to a senior executive of one major equity participant.
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Thursday, 24 September, 2009, 23:01 GMT | last updated: Thursday, 24 September, 2009, 23:01 GMT
