By Joshua Worlasi AMLANU\xa0
The government has entered into an agreement through a Memorandum of Understanding with various international oil companies as well as state-owned entities to prolong two crucial offshore production licenses until 2040. This move is expected to attract up to $2 billion in fresh investments, which will be used to enhance crude oil extraction and increase natural gas supplies.
The accord, detailed in an announcement on Wednesday, June 4, 2025, includes participation from the government alongside Tullow Oil Plc, Kosmos Energy Ltd., PetroSA, Ghana National Petroleum Corporation (GNPC), and its affiliate Explorco.
This area encompasses the West Cape Three Points (WCTP) and Deep Water Tano (DWT) blocks—regions where the Jubilee and TEN fields are located, making them some of Ghana’s most prolific petroleum resources.
As per this agreement, the collaborating venture partners are anticipated to extract up to 20 more wells within the Jubilee field throughout the duration of the extended licenses. This expansion is projected to substantially increase the overall 2P reserves, thereby bolstering the nation’s energy stability and financial gains from taxation.
The agreement goes beyond basic production targets with the objective of almost doubling the volume of gas extracted from the two offshore sites to approximately 130 million standard cubic feet each day, as stated by both parties involved. Additionally, the price for natural gas will be adjusted downwards, which should help alleviate some of the government's growing financial burdens within the energy sector.
The framework also incorporates a secured payment system for natural gas sales, which is crucial for resolving longstanding dues between the administration and upstream companies.
"This memorandum of understanding represents a substantial advancement in our country’s energy industry," stated Energy Minister John Abdulai Jinapor in the release.
He highlighted that the agreement will strengthen Ghana’s dedication to maintaining a secure investment environment, support continuous oil production, and promote infrastructural growth along with employment opportunities.
The parties have confirmed that all existing conditions within the present petroleum accords for the WCTP and DWT areas will stay unaltered.
Tullow, operating the Jubilee field, views this extension as crucial for its sustained expansion in West Africa.
This marks an important advancement for the government, Tullow, and our joint venture partners," stated Richard Miller, who serves as the company’s temporary CEO and CFO. "Extending and ensuring the financial stability of our agreements highlight how Ghana presents opportunities to increase value via enhanced production and reserve additions.
The partners will also be investing in GNPC and the Petroleum Commission to boost their capabilities, with an emphasis on utilizing cutting-edge technologies to enhance field operations and strengthen regulatory monitoring.
Kosmos Energy, which holds significant stakes in both areas, views this transaction as an indication of consistent policies and promising business prospects under President John Mahama’s recently established government.
"This memo acknowledges the significance of oil and gas in Ghana and highlights the new government's aim to establish a conducive atmosphere for investments," stated Kosmos CEO Andy Inglis.
The subsequent steps involve submitting an addendum to the Jubilee Plan of Development, finalizing new natural gas sale contracts, and obtaining parliamentary approval for license extensions along with a payment security framework—objectives the parties intend to achieve by the end of the third quarter.
The government aims to derive greater benefits from its hydrocarbon resources as it gears up for an extended shift towards sustainable energy sources. These prolonged permits offer new opportunities for the nation to capitalize on its upstream capabilities while investigating routes toward reducing carbon emissions.
Provided by SyndiGate Media Inc. Syndigate.info ).
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