Energy Expert Questions Sales Of Hess’s Oil Block To Aker

Information going round since February this year is that, the Norwegian billionaire Kjell Inge Røkke’s Aker Energy has acquired Hess’s Ghana operations, which come with access to a 50 percent stake in the Deepwater Tano/Cape Three Points project which is now on the brink of entering the development stage.

Aker Energy has served notice of presenting a plan soon towards the development of the block this year, with production from the West African country expected to start in 2021.

“Ghana is still in the early days of developing its oil and gas resources, so for us, it means we can quickly build up there at a very exciting price,” Aker CEO Oeyvind Eriksen told Reuters on the sidelines of an earnings presentation.

However, an industry expert, Alexander Mould, former Ghana National Petroleum Corporation (GNPC) who has been instrumental in Ghana’s oil and gas industry as the immediate past leader of the state-owned operator, has raised several questions against the said sale or transfer of interest from Hess to Aker Energy.

He is worried over the silence of government of Ghana since the start of the news going round. He questions, “Has this been approved by Government of Ghana (GoG)? Does it need Parliament ratification – who will be the Operator?”

He again quizzed, “With the sale of Hess’ 50% interest in the Block (which will reduce to 40%, if GNPC invokes it’s 10% Option) at the alleged US$100 million, will GoG/GNPC renegotiate the purchase of its 10% for $US20-25 million (instead of the US$47-50 million that the Option was priced at?)

GNPCs has the privilege to decide to invoke their Option for 10% of the Block which was part of the Lukoil farm-in conditions. But, it is unclear if GNPC has been given the chance to make their decision on the deal.

He asked, “Has GoG agreed with GNPCs decision to not invoke their option for 10% of the Block which was part of the Lukoil farm-in conditions?”

Again, the oil and gas expert, is worried as to if the government will insist on Aker abiding by the local content law (that is, allowing minimum of 5% of their interest given to a Local Partner), just like Lukoil were made to.

The transparency aspect of the deal is as crucial as the capability of Aker to meet the needed financial and technical capacity required of oil block operators. “Will this process be as transparent (with a clearly defined selection criteria – operational/technical ability as well as financial ability?), Mr. Mould asked.

The ultra-Deepwater Tano Cape Three Points block holds an estimated 550 million barrels of oil equivalent and has the potential for a further 400 million barrels.

 

By: Adnan Adams Mohammed

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