In a significant move, the John Mahama led government has withdrawn a contentious directive that mandated the unitization of two offshore oil fields, Afina-1X Discovery and the Sankofa Cenomanian Oil Field.
This decision follows a thorough review of an arbitration award and legal opinion from the Attorney General and Minister of Justice.
The directive, issued in 2020 by the previous administration, required Springfield Exploration and Production Limited (Springfield) and Eni Ghana Exploration and Production Limited (ENI) to jointly develop the two oil fields.
However, the move was met with resistance from industry experts, regulatory bodies, and the affected companies, who argued that the data did not support the claim of reservoir connectivity.
The arbitration tribunal, in its ruling, identified several procedural flaws with the implementation of the directives, including the absence of a statutory trigger for unitization and arbitrary determination of initial tract participation.
The tribunal acknowledged the potential value of unitization in principle but deemed the implementation of the directives as unlawful.
The Ministry of Energy and Green Transition, in a statement, acknowledged the tribunal’s findings and announced the withdrawal of the unitization directives.
The decision provides Ghana with the flexibility to determine the most appropriate course of action in the national interest.
The NDC government has reiterated its commitment to maintaining a conducive environment for investments in the upstream petroleum sector while ensuring compliance with the legal and regulatory framework governing the industry.
The withdrawal of the directive is seen as a positive move for Ghana’s oil and gas industry, which has been plagued by controversy and uncertainty in recent years.
-BY Daniel Bampoe
