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Ghana orders Eni, Springfield to unitise

  • SOURCE: Energy Voice | qwesa2big
  • Ghana has ordered Eni and Springfield Exploration and Production to unitise the Afina and Sankofa fields, after the two companies failed to make progress on their own.

    Ghana’s Ministry of Energy declared the fields unitised in a letter seen by Energy Voice. The letter was dated October 14 and was addressed to the managing director of Eni Ghana Exploration and Production and the CEO of Springfield.

    Under this order, the licence led by Springfield will have a 54.5% stake in the area and Eni’s licence 45.5%. The ministry has ordered that this unitised area would be in effect from when production started.

    Assuming the unitisation moves forward, Springfield will have notched up another achievement. It will have added significant deepwater production following the drilling of the discovery well last year, a feat few indigenous companies can aspire to.

    Run up

    Eni began producing oil on the Offshore Cape Three Points (OCTP) block in May 2017, starting up a non-associated gas project in August 2018.

    Springfield made its Afina discovery in late 2019, on the West Cape Three Points Block 2 (WCTP2). The Ghanaian ministry asked the two companies to begin talks in April this year.

    Progress appears to have been slow. The October letter said the two companies had failed to reach a confidentiality agreement and missed a report deadline of mid-September. The ministry described this as a “flagrant disregard” of commitments on co-operation.

    “Regrettably, it has become obvious that the parties do not intend to comply with the Minister of Energy’s directives,” the government said.

    As such, it ordered Ghana National Petroleum Corp. (GNPC) to carry out a study on the area. This resulted in a decision that the Cenomanian channel straddles the two blocks.

    WCTP2 holds 642 million barrels of oil in place, GNPC said, while OCTP has 535mn barrels.

    The ministry asked Eni to determine its past expenditure. Given that Eni’s field is already in production, the letter said, “the past expenditure of the Sankofa field shall be netted off against the past revenue from the sale of hydrocarbons produced from the Sankofa field, and any party with a positive balance shall be paid immediately”.

    GNPC report

    A technical evaluation on the WCTP 2 and OCTP blocks, prepared by Ghana National Petroleum Corp. (GNPC) appeared to support the ministry’s position. The Sankofa and the Afina well intersect the same channel complex, the October 6 report said .

    The Afina 1X Cenomanian reservoir “appears to be in likely communication with the updip Sankofa Cenomanian reservoir”. Oil from the Afina well is slightly denser, GNPC said, attributing this to the compositional gradient of the field, noting that a similar shift is found in Sankofa.

    Vitol made the initial gas discovery on the OCTP block in 2009, with Eni farming in that year. The Italian company discovered oil in 2012.

    Eni’s work on the Sankofa field’s Cenomanian reservoir includes eight oil producing wells. The Italian company’s share of liquids in 2019 from Ghana was 24,000 bpd.

    Springfield’s CEO Kevin Okyere, speaking in mid-September at the Africa E&P Virtual Summit, struck an upbeat tone on the Afina discovery. “The discovery we made is part of a field already in production. This shortens our cycle. This … should put us into production at the end of this year or early next year,” he said.

    Okyere went on to note the importance of local content in exploration and production. “It’s essential that African governments enhance localisation,” he said.

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