The Petroleum Commission (PC) has signed four agreements with international firms in a bid to secure advanced geological data – 3D seismic data – on the country’s oil fields, according to Director-Local Content, Kwaku Boateng.
The agreements were signed with four international firms: Petroleum Geo-Services (PGS), Exploro Geo-Services, TGS-TG-GeoPartners and one other company as part of a multi-client data initiative. This data acquisition initiative is expected to cover all the offshore basins.
These deals represent a proactive effort by the Commission to deepen understanding of Ghana’s oil reserves and boost investor confidence.
The establishment of geological prospectivity, Mr. Boateng said, will further demonstrate to the investor community the potential of the country’s oil fields, and thereby attract more investments into Ghana’s oil sector.
“We are also encouraging existing investors to invest in data acquisition – like Tullow, who recently acquired 4D seismic data in the Jubilee Field… specifically the Tano area,” he added.
Additionally, he said, while the fiscal regime of the oil and gas is good, the Commission is pursuing amendments whereby there will be tailor-made fiscal elements applicable to specific oil block – termed as categorisation of the block. This encompasses the floor block, water depth, potential reserves, data coverage among others of the block.
This means blocks determined to be riskier will attract generous fiscal regimes to encourage companies to invest, whereas blocks with great potentials and less risk will attract strict fiscal regimes in contrast to the ‘one-size fits all’ fiscal regime that currently exists.
The ongoing fiscal regime reforms are intended to attract new investments and address challenges with the existing fiscal regime. This is believed to have become necessary in the wake of growing concerns on energy transition and its attendant adverse impact on investments.
The Director-Local Content, who was speaking in an interview on the 3rd Africa Energy Summit’s sidelines in Accra, added that some of the new measures being considered by the Commission also include replacing the fixed rate royalty scheme with a more progressive two-tier royalty scheme.
Others are the revision of additional oil entitlement, minimising front-end loads and rationalising state participation among others.
Responding to concerns about the inability to attract new Petroleum Agreements (PAs) since 2018, Mr. Boateng emphasised efforts that encourage existing operators to invest more in exploration, drilling and production activities. Regulatory requirements are being reviewed to make them more flexible and attract new investments, he added.
It will be recalled that the Public Interest and Accountability Committee (PIAC) and other civil society actors have called for the country to make immediate investments in data and regulatory reforms in the oil and gas sector.
This comes as the country faces continued decline in oil production as it struggles to attract new investments, with the total number of PAs still remaining at 14 as of now.
Energy Law Lecturer at the University of Professional Studies (UPSA) Law School and representative of the Ghana Bar Association (GBA) on PIAC, Ms. Yorm Ama Abledu, said Ghana is endowed with significant hydrocarbon resources but stands at a crossroad.
“The promise of its oil and gas potential sparked hope for economic transformation and enhanced regional stability when the announcement of commercial production was made in 2011. Yet, amid these opportunities, we confront a sobering reality: the challenges that hinder Ghana’s ability to fully harness its petroleum potential.
“Today, we confront a critical question: why has Ghana struggled to attract major projects in its oil and gas sector in recent years? This inquiry is not merely academic but speaks to the heart of Ghana’s potential and its journey toward energy security and economic prosperity,” said Ms Abledu who was a guest speaker at the Summit .
Her presentation during the Summit highlighted a need for urgent reforms among others in the local oil and gas sector.
She said, for instance, that as oil and gas projects become increasingly expensive, it’s a crucial the quality of data on designated blocks is high to get the buy-in of investors to sink in money.
“In the case of Ghana, as its basins are largely not de-risked, significant data gaps and low data quality exist. This has made its data unreliable and led to low investor confidence in its blocks. It was one of many reasons why a number of IOCs pulled out their bids in Ghana’s maiden bid and licencing round in 2018.”
The 3rd Africa Energy Summit was organised by Offshore Africa Magazine on the theme ‘Africa and the New World Energy Order’.
Chief Executive-Offshore Africa Magazine, Mr. Gilbert Da Costa, in his remarks at the event also said the forum provides a platform to examine trends in the upstream oil and gas sector and how to address the emerging challenges.
“This is because this is one industry that can change the course of history in Africa. It provides a lot of resources,” he said.