Business News of Wednesday, 16 May 2018
Minister of Energy, Boakye Kyeremateng Agyarko
The Minister of Energy, Boakye Kyeremateng Agyarko has inaugurated licensing rounds bid, evaluation and negotiation committee to help government undertake Ghana’s first bidding rounds at the end of the year.
According to the Minister, the licensing rounds will have its focus on the Western Basin where there is an existing infrastructure that could facilitate the development of any discovery made in the area.
He said at the moment, there are two gas pipelines to shore three production facilities thus the FPSOs and a fourth FPSO which would be ready by 2021.
“These assets will ensure the quick development of hydrocarbons, maximizing value and minimizing cost. The overall effect is increased revenue to the state and development benefits of people,” he noted.
Mr Agyarko further stated that the first class production assert will enter their natural decline phase as the ministry continues to deplete this exhaustible natural resource.
“At the same time, exploration activity has slowed down since the dawn of the low price era in 2014. This has been compound by the boundary dispute between Ghana and La Cote D'ivoire. In fact, the last time an exploration well was drilled was in 2014.”
The Minister, however, announced an allocation of the nine oil blocks will ensure that a regulatory framework to govern the increasing process which has been submitted to the Attorney General’s Department for drafting and will be soon laid in Parliament to mature into a legislative instrument.
“The Ghana Model Petroleum Agreement is being reviewed to align it with the Petroleum Exploration and Production Act (Act 919) and new regulations,” he said.
“Government is also developing for the first time, a model joint operating agreement, to guide investors on the acceptable norms for joint ventures. A Geology and Geophysics Committee which I establish recently has successfully mapped out prospects in the Western for demarcation into nine (9) blocks which will form the basis of our upcoming licensing rounds” he explained.
He stated that three of the blocks shall be allocated through open public competitive tender, whilst two of the blocks shall be allocated through direct negotiations, whereas one of the blocks will be reserved for GNPC to explore in partnership with its chosen strategic partner with the view to develop its technical capacity.
“The remaining three of the will not be allocated this year, but will form the basis of our second bidding rounds next year,” he said.
The terms of reference for the committee, according to Mr Agyarko will be to “Prepare all the necessary documentation for a successful bid round, access and package all the data on these acreages, set up online data room where all the data can be accessed by prospective bidders and embark on promotions and roadshows in collaboration with the petroleum commission.”
The committee will also “invite bids from prospective applicants, carry out pre-qualification of applicants in line with applicable regulations, evaluate qualified bids and select winners in line with transparent criteria and negotiate with the winners and provide recommendations to the minister for signing petroleum agreements.”
In order to discharge the task assigned to the committee, the members will be grouped into three (3) sub-committees with a coordinator to coordinate the activities of the sub-committee. The three sub-committees are Technical Sub-committee, Commercial Sub-committee and Legal Sub-committee.