Supermajor oil producing companies are knocking on the doors of Ghana to invest in the country’s upstream petroleum sector, Deputy Minister for Energy and Green Transition, Richard Gyan Mensah, has disclosed.
The revelation was made by the Director of the Upstream Petroleum Sector at the Ministry of Energy and Green Transition, Dr Callistus Nero, on behalf of the Deputy Minister at the launch of the 2023 Ghana Extractive Industries Transparency Initiative (GHEITI) Report in Accra.
According to Dr Nero, the renewed investor interest in Ghana’s oil and gas sector is being driven by ongoing policy and legislative reforms aimed at improving governance, ensuring regulatory certainty and to create a more competitive fiscal regime.
“Already, the proposed reforms are beginning to make an impact as some supermajor oil producing companies are knocking on our doors for business, giving us the conviction that the situation will even get better when the reforms are finally approved,” he stated.
He explained that the Ministry is taking pragmatic steps to address challenges highlighted in the 2022 Oil and Gas Sector Report, particularly issues surrounding gas aggregatorship.
He revealed that a ministerial committee has reviewed the country’s upstream policy and legislations and proposed solutions, which are currently under consideration by the relevant authorities.
Dr Nero noted that the reforms are expected to help arrest Ghana’s oil production decline and boost the country’s reserves, while restoring investor confidence in the sector.
In the short to medium term, government has also secured major financial commitments from existing operators to augment production.
He disclosed that the State has signed a Memorandum of Understanding with partners in the Jubilee and TEN fields for an additional US$2 billion investment, while partners in the Offshore Cape Three Points (OCTP) fields have committed a further US$1.5 billion.
“These and other interventions will keep the industry supporting the economy while long-term measures are pursued,” Dr Nero said.
The Deputy Minister, reaffirmed government’s commitment to resetting the oil and gas sector and positioning it as a key driver of economic growth, emphasising that transparency and stakeholder collaboration, championed by GHEITI, remain critical to achieving sustainable development in Ghana’s extractive industries.
Background
Ghana’s crude oil production has experienced a steady decline in recent years, largely due to reduced investment in new exploration and field development activities. After peaking in the early years following the start of commercial production in 2010, output from key producing fields such as Jubilee, TEN and Sankofa has stagnated as existing wells mature and natural reservoir pressure declines. The absence of aggressive appraisal drilling and delayed final investment decisions on new blocks have limited the country’s ability to replenish reserves and sustain production levels.
Industry analysts attribute the slowdown mainly to regulatory uncertainties, fiscal regime concerns and global shifts in capital allocation within the energy sector, which have made Ghana less competitive compared to other emerging offshore provinces. The situation has been compounded by falling international investment appetite for frontier exploration, leading to fewer licensing rounds and underutilisation of Ghana’s upstream potential, despite its proven geological prospects.
By: Christian Kpesese
