The recent international tribunal ruling in favor of Eni and Vitol in their dispute with Ghana over oil field unitization is a significant development for the Ghanaian upstream petroleum sector.
We spoke to David Ampofo, CEO of the Ghana Upstream Petroleum Chamber, about the implications.
The Case and the Ruling:
The case centered on the Ministry of Energy’s directive to unify the Sankofa-Gye Nyame oil field operated by Eni and Vitol with the Afina discovery operated by Springfield. Eni and Vitol argued that the unitization process violated Ghanaian law and international best practices. The tribunal agreed, ruling that Ghana breached the Petroleum Agreement.
Industry Reaction:
The Chamber welcomes the ruling’s finality, which clears the way for renewed activity in the sector. Importantly, the ruling doesn’t prevent future unitization conducted lawfully. Both parties have expressed commitment to the Sankofa field’s development and further investments.
Looking Ahead:
- Compliance and Amicable Resolution: Ghana must withdraw the current unitization directive and halt related legal proceedings. Both parties should now engage in constructive discussions to reach an amicable solution.
- Reinvigorating the Industry: With the dispute resolved, the industry can focus on development. Eni and Springfield’s roles are crucial in bringing discovered oil reserves to production. Eni’s continued operations are seen as beneficial to Ghana.
- Springfield’s Discovery: Appraising Springfield’s Afina discovery will provide a data-driven basis for future discussions.
Ghana Upstream Oil & Gas Conference:
The Chamber encourages industry stakeholders to attend their Annual Conference (September 25-26th) at the Marriot International Hotel. The event will include the launch of two key reports: the “2024 Upstream Petroleum Report” and “Ten years of local content and participation in Ghana’s upstream oil & gas industry.”
This ruling presents an opportunity for Ghana and industry players to work together to revitalize the upstream oil and gas sector. The upcoming conference is a great platform to discuss future prospects.
