Norwegian-based oil exploration and production firm, Aker Energy AS, believes its successful entry into Ghana’s upstream petroleum business is a timeous opportunity to transfer Norway’s decades of technical expertise and vast experience in the oil and gas industry to the country and the sub-region as a whole.
The transfer will be achieved through conscious mentoring and subcontracting to local staff and firms, the Chief Executive Officer (CEO) of Aker Energy, Mr Jan Arve Haugan, told journalists in Accra.
In his first interaction with journalists in Accra after Aker Energy successfully replaced Hess Ghana Limited as the operator and 50 per cent owner of the Deep-Water Tano Cape Three Points (DWTCTP) block, Mr Haugan said the company’s contribution to the country and its domestic stakeholders “will be beyond the local content” requirements captured under the Local Content and Local Participation Policy.
“We want to contribute to the local economy beyond the requirements of the local content. We know that the oil and gas sector has some sort of minimum requirements on local content and that is a good picture of good governance.
“But sometimes, that is also a system that does not really build the industry in the country. So we have communicated very clearly that the Aker family, which I am the representative here today, has an obligation from the owners of the company to contribute to competence beyond local content,” he stated.
Aker Energy, the energy wing of Norwegian billionaire, Mr Kjell Inge Rokke, entered Ghana’s nascent upstream petroleum subsector in February this year through a US$100 million share purchase agreement with Hess Ghana for its stake in the DWTCTP block.
A financial closure of the transaction was reached last month, paving the way for Aker Energy to pay US$25 million to Hess Ghana. The remaining US$75 million is to be paid after the plan of development (PoD) has been approved by the government, according to the requirements of the transaction.
Following the sale, Aker Energy will now lead Lukoil (38 per cent), the Ghana National Petroleum Corporation (10 per cent) and Fuel Trade (two per cent) to develop and produce oil in the block, which has proven reserves of about 550 million barrels of oil equivalent with additional potential of 400 million barrels.
Mr Haugan said Aker Energy was working hard to ensure that the PoD was submitted to the government in July to pave the way for its approval by December this year.
“We have clearly communicated that the critical activities need to be triggered by the end of the year. So currently, we are preparing the application for the development and that has to be submitted for approval to be given before the end of the year,” he noted.
He added that the approval would be followed by an ‘order to proceed’ in 2019, enabling the various actors to start development works.
“In 2020, it will be the year of assembling, where we will start to manufacture in various locations, then we put the pieces together and divide our pieces into three major blocks – the subsea production system (SPS), the subsea umbilicals, risers and flowlines (SURF) and then the floating, production, storage and offloading (FPSO) vessel,” the CEO mentioned.
He explained that although the company had “framed agreements to be copied from Aker BP,” our sister company in Norway, for the SPS and the SURF, that of the FPSO was different, given that it would be a purpose-built vessel.
“For the FPSO, we took the work that was done by Hess and we started. All the technical considerations have been completed and closed, and then we started the commercial process,” he said.
He explained that the bid for the FPSO was opened in early April, with the evaluation currently ongoing; with the hope that it would be completed by the end of the year.