The oil production
company, Aker Energy A.S. (Aker Energy) has secured $100 million (GH¢) to
invest in crude oil and natural gas production from Ghana’s Deepwater Tano Cape
Three Points (DWTCTP) block.
The block, offshore Cape Three Points in the Western Region, contains multiple
oil fields and the lender, the Africa Finance Corporation (AFC), a leading
infrastructure solutions provider in Africa, has pledged its readiness to
“participate in follow-on fundraising activities”.
A statement issued by the AFC, through the African Media Agency (AMA), in Accra
yesterday said the investment aligned with the AFC’s overall natural resources
strategy, which entailed building a portfolio of value-added assets across the
energy value chain.
“By taking an early equity financier role in operational or near-operational
upstream assets, the AFC can enhance the revenue potential of African states to
generate revenue required for investment in infrastructure and social services
for its growing populations,” it said.
It added that the investment also marked the beginning of the AFC and Aker’s
mutually beneficial relationship in the exploration and production sector
across the African continent, adding: “The AFC will offer support to Aker, open
new opportunities and mitigate potential geopolitical risks.”
The statement acknowledged Aker’s proven track record of delivering complex
deepwater projects on time and budget, and that with a network of affiliates,
such as Aker Solutions, a leading subsea equipment and services provider, “Aker
is an ideal partner for the AFC as it seeks to broaden its partnerships with
developers within the natural resources sector”.
The AFC already has a wide range of portfolios in Ghana in the financial and
the energy sectors.
Background
Aker is a subsidiary of Aker S.A., one of the highest-quality-rated companies
on the Norwegian market and a leader in oil, gas and industrials.
The AFC’s support is through investing in $100 million of convertible bond
notes with an intention to participate. The funds will be used by Aker Energy
to finance the development of the block owned by joint venture partners,
including Aker Energy (50 per cent), Lukoil (38 per cent), Fueltrade (two per
cent) and a 10 per cent carried interest for the Ghana National Petroleum
Corporation (GNPC).
The Pecan field, which is the most appraised in the DWTCTP block and the field
to be developed in the first phase, is an oil field estimated to contain
reserves of about 334 million barrels of oil equivalent.
Why the funding
Ghana became a sovereign shareholder in the AFC last year, having acceded to
membership in 2011, hence its eligibility to access funding from the
corporation. The government will also benefit from the Aker project through
increased revenue and government royalty and taxation income.
Ghana is currently reeling under shortfalls in domestic revenue mobilisation
and needs to increase its tax efforts.
The DWTCTP field is one of Ghana’s principal hydrocarbon assets and is expected
to contribute to near-term target of an annual production volume of 500,000
barrels of oil equivalent per day.
The President and Chief Executive Officer (CEO) of the AFC, Mr Samaila Zubairu,
said: “This is an exciting milestone for the AFC — we have partnered with
the subsidiary of one of the most highly respected international oil, gas and
industrial companies to support its first project in the African market as an
operator.
“This is an opportunity for the AFC to invest alongside a technically and
financially strong sponsor that requires project development expertise and
public sector advice in Africa, both of which the AFC is ideally placed to
offer.”
The CEO of Aker Energy, Mr Jan Arve Haugan, added: “We value the AFC’s
vote of confidence by collaborating with Aker Energy and the commitment to
further strengthen this partnership, going forward. We believe the AFC will be
a valuable partner to help Aker Energy navigate the opportunities and
challenges that lie ahead of us.”
Local players
Some players in the country’s upstream oil and gas operation have welcomed the
move by Aker Energy to swiftly source funding to support its projected budget
for the development of the DWTCTP block.
The Norwegian oil firm recently submitted a $4.4 billion plan for developing
Ghana’s fourth independent oil field in the Tano Basin to the Ministry of
Energy.
The Ghana Oil and Gas Service Providers Association (GOGSPA) commended the AFC
for showing interest in the development of African projects to improve the
lives of its people.
Speaking with the Daily Graphic, Mr Nuerty Adzeman said: “We want more of such
businesses; the oil industry is about funding and building the technical
expertise to ensure sustained production.”
He said the country’s three oil fields, which were currently producing a little
over 200,000 barrels of oil per day, were not enough, for which reason there
was the need for more exploration and reserves with correspondent funding to
extract the resource for national development.
“We are happy companies in Ghana are attracting the attention of the AFC, which
is the leading African grade A-rated multilateral development finance
institution,” he said.
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