Saturday 24 August 2019

Tullow eyes more growth in Ghana as it scraps plan to sell stake in big asset


Paul McDade Tullow Oil. Photo:
Paul McDade Tullow Oil. Photo:

Kawasi Kpodo

Irish oil and gas explorer Tullow Oil is interested in new oil blocks off Ghana's coast as part of its plans to consolidate its operations in the West African nation, chief executive Paul McDade said.

Tullow is leading two operations off the coast of Ghana, including the country's flagship 100,000 barrel-per-day Jubilee field, which began commercial production in late 2010.

Ghana's energy ministry said this month it would award nine new upstream oil blocks for commercial exploration off its coast beginning this year.

"We as a company want to consolidate our presence in Ghana after our investments in Jubilee and TEN (the Tweneboa, Enyenra, Ntomme project). We don't want to stop there but keep growing," McDade told reporters in Accra, where he was meeting investors.

"We'd like to go and look at the new licenses being opened, we'd look at them from a geological point of view and if we find them attractive, you'd find us bidding for them," he said.

Tullow has given up plans to reduce its stake in its TEN field which came on stream two years ago because the need for raising capital from the sale no longer existed, McDade said.

McDade was speaking a week after the government of Peruvian President Martin Vizcarra cancelled his predecessor's decision to award five offshore oil contracts to Tullow. The reversal was seen as a victory for fishermen and environmentalists who said that exploration and drilling would have put important fisheries and whale breeding grounds at risk.

It was another setback for efforts to shore up slumping energy investments in Peru, a relatively small oil producer where past bidding rounds have failed to draw offers.

Tullow said it would consider "next steps".

The revocation "is deeply disappointing", said George Cazenove, Tullow's head of communications.

"Tullow has complied with the process and procedures required under Peruvian law."

Earlier last month, the Peruvian comptroller's office said it had found nothing illegal about the contracts, but that the process of granting oil concessions through direct talks should be more transparent and give other stakeholders more say.

The contracts came under fire after Peruvians learned the disgraced former president, Pedro Pablo Kuczynski, had signed five decrees authorising them just before stepping down in March ahead of an impeachment vote.

Despite Kuczynski's approval, the contracts themselves were never signed, state energy promoter Perupetro said.

Vizcarra's government said Perupetro had negotiated the contracts directly with Tullow without giving communities along Peru's northern coast enough time to weigh in.



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