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Gold/Mining/Energy
Clontarf Resources (CLON) Ghana Ratification Expected
An SI Board Since June 2017
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Emcee:  miningoz Type:  Moderated
Ghana under pressure to rethink incentivesCompanies ask government to reconsider fiscal packages for offshore licences as tough times for industry continue.

Ghana is facing increasing pressure to renegotiate fiscal packages for offshore licence holders in the wake of tough industry conditions and the general perception that oil prices may languish lower for longer.

“It’s a bad situation and there has been no real exploration for the past three years," said a senior Ghanaian industry official.

"The Energy & Petroleum Ministry will insist on clear justification for any extension request with several companies successfully securing agreement for an adjustment of terms, while others have not.”

In addition to extensions, some companies have requested postponement of upfront payments required under the training and technology transfer provisions of the Petroleum Agreement’s model contract — which in Ghana is a hybrid licence combining tax and royalty clauses with elements of the classic production sharing contract.

Also delayed by financial constraints are myriad smaller schemes which planners hoped might be executed by minnows already committed to appraise, develop and tie back smaller oil and gas deposits into existing and planned infrastructure.

“In order to restore momentum, new entrants must now be attracted into the deep where new flexibility has been built into the 2016 Petroleum E&P Act, allowing operators to drill a duster but then move directly to test a completely different play type,” said the Ghanaian official.

However, no real movement is expected until the International Tribunal on the Law of the Sea (ITLOS) decides in September whether to draw the maritime boundary in favour of neighbouring Ivory Coast or to leave the bulk of the proven and producing Tano basin in Ghanaian waters.

Of primary concern is Tullow Oil's Tweneboa-Enyenra-Ntomme field which urgently requires development drilling - banned by ITLOS until further notice - to ramp up production to 80,000 barrels per day in addition to targeting first deliveries of non-associated gas this August.

Meanwhile, the official June map issued by the Ghana National Petroleum Corporation (GNPC) details the latest status of offshore operatorships in the nation's waters.

In the Keta basin bordering Togo, Swiss-African signed up the transition zone last year. And, while UK-listed Ophir Energy and Italy's Eni are among those that have left that area, Heritage Oil has managed to hang on to acreage both here and in the western Tano basin.

The Central basin has seen the Medea Group and Nigerian independents Amni International, Brittania-U and Sahara Group maintain their licences, whereas fellow Nigerian Oranto Petroleum finally relinquished its Saltpond acreage, leaving Saltpond Offshore Producing Company with the depleted rump of a field and the GNPC pondering how to decommission the infrastructure.

Ghana-owned newcomer Springfield Energy in joint venture with GNPC exploration subsidiary ExplorCo, has jumped into the West Cape Three Points block.

It is located in the Tano basin where most players have managed to hang on including Ireland's Petrel Resources and Clontarf Resources tie-up , which remains in discussion with the GNPC over the Tano shallows but ratification is anticipated withing days.
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