The country’s upstream oil and gas industry is expected to witness some positive sentiments following the submission of a plan of development (PoD) of Deepwater Tano Cape Three Points (DWT/CTP) block to the Ministry of Energy by Pecan Energies.
The DWT/CTP block had Pecan Energies, formerly Aker Energy as the operator, with 50 per cent interest with its partners, Lukoil Ghana, with 38 per cent interest while the Ghana National Petroleum Corporation (GNPC), 10 per cent, and Fueltrade Limited, two per cent.
Per the petroleum agreement, oil companies can initiate procurement contracts without recourse to the Ministry of Energy – therefore, local Ghanaian firms may get some contracts under the local content Legislative Instrument but it might not be in the quantum envisaged.
The buoyant sentiments that mostly characterise the oil industry after approval and regulator enforcing the local content are that the indigenous industry players are free to clamour for jobs but that has gone down drastically after the development of the last two independent oil fields – TEN and Sankofa Fields.
The entry of Aker Energy in the upstream sector in 2018 came with high expectations but that hope has declined after the company, which promised to work closely with license partners and authorities to submit a PoD in the second half of 2018 with anticipated first oil in the fourth quarter of 2021 failed to deliver.
The then Chief Executive Officer of Aker, Mr Jan Arve Haugan, in 2018 said “The development concept will build on experience derived from operations on the Norwegian Continental Shelf – a country with an enviable record of transparency and enormous experience in the upstream sector.
It is expected that the approved PoD with corresponding funds to invest in offshore Ghana would see the crude strengthening the country’s economy and improved the wellbeing of the citizenry in this critical moment.
For instance after the activities supporting the upstream oil and gas industry in Ghana dipped, many workers – welders/fabricators, scaffold technicians with all certifications, procurement officers and many other support services were asked to go home and some could not survive the shock.
Again to make matters worse, after the emergence of COVID-19, many companies went down as oil prices dipped to the lowest and some, especially the Ghanaian entities have not been able to recover till date.
As a result the gains from the development of the country’s second and third independent oil fields, which saw a lot of bullish activities and placed the Ghanaian oil service industry on a high scale decline, plunging many into unrecoverable debt.
Some of the finished fabrications at the yards of Seaweld Engineering at Biahu in the Ahanta West Municipality
The development of the Tweneboa, Enyenra and Ntomme (TEN) in 2013 for instance, went to Ghanaian companies who played a vital role in the conversion of the then Centennial Jewel oil-tanker in Singapore by fabrications large steel work in Ghana.
Such moves supervised by the Petroleum Commission for contracts for local companies did not only create jobs locally, but also transferred a lot of skills to Ghanaian welders and other mechanical engineers who were engaged, retrained and certified to carry out fabrication.
That was an improvement over the development of the first oil field, Jubilee, which saw a lot of procurement of services outside the country owing to the fact that Ghanaians did not have the skills available at that time.
However, there was an improvement during development of Tweneboa, Enyera and Ntomme (TEN) and Sankofa fields by Tullow Ghana and Eni Ghana, which saw considerable Ghanaian companies such as Seaweld Engineering, Rigworld, Zeal Environmental Technologies, Wayo Engineering, JVC Ventures, Macro and Mac Logistics among other emerging companies.
Ghanaian companies carried out the construction of the tool, riser-protection units; suction piles among others running into millions of dollars in contract to Ghanaian firms as well as other Ghanaian joint ventures that are supporting the industry to effectively run – thus retaining measurable spending in-country.
Therefore the announcement of the current PoD gives another hope to Ghanaian companies, which over the years have acquired some appreciable skills in welding and fabrication, logistics and other services to get jobs when the PoD is approved.
Pecan Energies said the submission was a major milestone for its commitment to the development of the industry in the country.
The Chief Executive Officer, Ms Kadijah Amoah, said the company and its partners had submitted a comprehensive PoD that would form the basis for a sustainable and efficient development of the Pecan field.
The PoD, she said, presented an overall plan for a phased development and production of the resources in the DWT/CTP contract area.
The phased development plan will start with the development of the Pecan field as a firm phase-I, being the largest of several discoveries in the contract area.
The main Pecan field, she said located in ultra-deep waters ranging from 2,400 to 2,700 meters about 115 kilometers offshore Ghana, will be developed with a Floating Production Storage and Offloading (FPSO) vessel and a subsea production system.
Ms Amoah expressed the hope that there would be expeditious action on the approval of the PoD “so we can get to work, developing and producing the resources for the ultimate benefit of the Ghanaian people.”
Many industry players are upbeat about the submission of PoD to the ministry.
This is not the first time the company has announced its intention to develop the field.
The industry is of the view that after the approval of a field development plan which formed critical part of regulating the sector through the commercial document, the government should be fully informed of all matters related to the development of its resources in the areas of technical, financial/economic, health, safety, security, environmental and social as well as the risks associated with the project to enable sound decision making.
All future petroleum activities within the contract area is expected to be consistent with the approved development plan which still remains the most important approval points for the state.