Government has decided to reserve three out of the nine oil scheduled to be put on offer in the upcoming licensing round expected this year, the Energy Minister, Boakye Agyarko has stated.
The reserved blocks will form the basis of the second bidding round next year.
He made this announcement at the inauguration of the licensing rounds bid evaluation and negotiation committee on Wednesday.
Agyarko mentioned that government is determined to identify further prospects in the Eastern, Central and the onshore Voltain basins to increase the number of blocks available for allocation.
“This will put to test all allocation mechanisms prescribed by the Petroleum Exploration and Production Act (Act 919) in order to examine the efficacy of these mechanisms and to address any challenges that may emerge in the application of the law.”
In explaining the allocation for this year’s round of bidding offer for the oil blocks at the end of the year, Agyarko noted that, three of the blocks will be allotted through open public competitive tender; two shall be allocated through direct negotiations.
The remaining one will be reserved for Ghana’s national oil company, the Ghana National Petroleum Corporation (GNPC), to explore in partnership with its chosen strategic partner with the view to developing its technical capacity and becoming an operator.
This year the licensing rounds will be focused on the Western Basin, due to the availability of infrastructure that could facilitate the development of any discovery made in the area.
Agyarko revealed that a fourth Floating, Production, Storage and Offloading (FPSO) vessel will be in place by 2021.
This will ensure a quick development of hydrocarbons, maximising value and minimising cost.
In line with government’s policy objective of replacing existing reserves before they start declining, it has become necessary to create the environment for accelerating activities through the strategy of aggressive exploration.
Agyarko noted that, in preparing for the allocation of more oil blocks in accordance with Act 919, government has put in motion some measures including a regulatory framework to govern the licensing process with the Attorney General’s Department for drafting.
In addition to this, the Ghana Model Petroleum Agreement is being reviewed to align it with the Petroleum Exploration and Production Act (Act 919) and new regulations. Moreover, Government is also developing, for the first time, a Model Joint Operating Agreement, to guide investors on the acceptable norms for joint ventures.
The licensing rounds bid evaluation and negotiation committee will be mandated to setup online data room where all data can be accessed by prospective bidders, as well as embarking on promotion and roadshows in collaboration with the Petroleum Commission, among other key mandates.
By Joshua W. Amlanu