Minority wants Renegotiated AGM/Aker Energy deal withdrawn

The Minority National Democratic Congress (NDC) Caucus in Parliament is demanding for the immediate withdrawal of the renegotiated AGM/Aker Energy Petroleum Agreement which is currently before the House for consideration and approval.

In the view of the NDC MPs who have been on a crusade against the new deal since yesterday, the renegotiated petroleum agreement will not inure to the benefit of Ghanaians and the earlier it is withdrawn the better

In the view of the NDC MPs who have been on a crusade against the new deal since yesterday, the renegotiated petroleum agreement will not inure to the benefit of Ghanaians and the earlier it is withdrawn the better.

According to them, the stake of the country in the original agreement which was brokered by the previous government headed by Mr. John Dramani Mahama, has been slashed down by 25% in favour of Aker Energy, the new owner of the oil block.

Addressing a press conference in Parliament, Friday, May 3, 2019, the Minority Leader, Haruna Iddrisu, disclosed that 5% of the new agreement covering South Deepwater Tano contract area has been given to an unknown local company, Quad Petroleum, which interestingly, was registered on April 10, 2019.

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Quad petroleum, according to the NDC MPs, also started operations on the same date it got registered, raising doubts about technical and financial capacity of the local oil company.

To the Minority, the action by the Akufo-Addo-led government clearly demonstrates that they have ceded Ghana’s petroleum interests to foreign hands.

“Instead of protecting the public purse and ensure that the citizenry benefits from the country’s petroleum resources, the current government has demonstrated beyond reasonable doubt that it is more concerned in protecting foreign interest to the detriment of the collective national interest”, he noted.

He added “…rather than improving or maintaining the original agreement executed between the Government of Ghana (GNPC), GNPC Explorco on one side, Akufo-Addo Government has shamefully reduced Ghana’s stake from 43% to a paltry 18%, representing a reduction of 58%. The impact of the “selloff” from AGM/Aker Energy is huge; a potential loss of over 250 million barrels of recoverable oil production equivalent which is almost the size of the entire Jubilee Field”.

To the Minority Caucus, the renegotiated deal is a rip-off, especially, as the GNPC has already invested over US$30million in acquiring data and reducing exploration risks over the Block, thus making it attractive prior to the entry of AGM/Aker Energy into same Block.

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Background

The previous NDC-led Government negotiated and executive the South Deepwater Tano Contract Area with AGM Petroleum Ghana Limited with Ghana securing the following stake:

–              Royalty: 10%

–              GNPC carried interest: 10%

–              GNPC additional interest: 15%

–              GNPC Explorco: 24%

The existing Petroleum Agreement gives Ghana potential 43% stake; made up of Carried and Participating Equity Interests of 25% and a Commercial Interest of 24% of the remaining 75%.

However, per the renegotiated agreement presented to Parliament for ratification, Ghana’s interest is as follows:

–              Royalty: 10%

–              GNPC carried interest: 15%

–              GNPC additional interest: 3%

–              GNPC Explorco: 0%

–              Enhanced tax relieves.

 

According to the Minority. “This renegotiated agreement is a complete rip-off and a betrayal of the people’s trust bestowed on this NPP Government”.

They do not see why the Government is bent on ratifying the renegotiated agreement when a request from AGM Energy Group for same was turned down by the former Minister for Energy, Hon. Boakye Agyarko.

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