The Energy Minister has caught Freddie Worsemawu Blay, Board Chairman of the Ghana National Petroleum Corporation (GNPC), in a "scandalous" attempt to reduce Ghana's 7percent interest in Anardarko Deep Water Tano ("DWT") and transfer it to the Petroleum Oil and gas Corporation of South Africa ("PetroSA").
Dr. Matthew Opoku Prempeh reported Mr. Blay to President Nana Akufo-Addo after warning him, the GNPC management, and the other board of directors to "cease any further negotiations with PetroSA" due to his "absurd" behavior.
The Minister stated that his ministry "has received a copy of a letter dated April 23, 2023, from the Chairman of the Ghana National Petroleum Corporation (GNPC) to the Petroleum Oil and Gas Corporation of South Africa ("PetroSA")..."
"In the referenced letter, the Chairman of the GNPC board invites PetroSA to preempt the 7% interest recently acquired by the Government from Anadarko West Cape Three Points Company ("Anadarko"), and proposes an equal split of the Deep Water Tano ("DWT") portions, thereby reducing the Government's interest.
In a letter dated May 16, 2023, the Energy Minister informed the GNPC Chairman and other Board of Directors, "I wish to reiterate the directive in my letter of 28th October, 2022, reference SCR/KA.118/305/02 that; "the Corporation should cease all further negotiations with PetroSA regarding PetroSA's intention to pre-empt the JOHL stakes.
In his letter, Dr. Opoku Prempeh added, "The Ghanaian government purchased the stakes with State funds." During a bilateral meeting conducted in Cape Town during the African Energy Week in 2022, the Government of Ghana informed the Government of South Africa through the Minister of Natural Resources and Energy that Ghana would not sanction any pre-emption of JOI-IL stakes.
"Following a meeting with my counterpart, the Honorable Gwede Mantasha, Minister of Mineral Resources and Energy in South Africa, on the aforementioned subject, I was compelled to formally respond to him in two successive correspondences affirming the government's position on the matter, and you were copied in all instances," he explained.
He continued, "It is outrageous that, despite these directives, you directed GNPC to offer PetroSA a portion of the government's JOI-IL interest in the DWT. I order you to immediately cease any further violations of the directives and to rescind the offer made to PetroSA in your letter dated April 23, 2023.
The same day, May 16, 2023, the Energy Minister sent a letter to the President's Secretary regarding Mr. Blay's "scandalous" behavior, stating, "We wish to bring this action of the Chairman, which is in direct contravention of the Government of Ghana's express directive on the subject matter, to the immediate attention of His Excellency the President."
The letter bearing the Minister's signature stated, "It is absurd that the Chairman, knowing the Minister's position and having taken an opposing stance against the Minister's directive, cautions PetroSA in paragraph 4 of his letter that, This agreement, however, remains subject to the written consent of the Minister of Energy for Ghana." Clearly, the Chairman is requesting PetroSA to test the Ministry's resolve, as conveyed in its notification to PetroSA that such a request for approval will neither be entertained nor granted if made.
The letter was also copied to the Minister of Justice and Attorney General, the Deputy Ministers of Energy, the CEO of GNPC, the Director of Petroleum, and the Legal Director of the Ministry of Energy.
It stated, "Mr. President will note that beyond these points, a transaction that purports to dispose of approximately fifty percent of the DWT stake that GNPC already owns can be considered a divestment of the State's beneficial interest." This would require significantly more than the Minister's simple sanction. If His Excellency approves of this divestment, not only the PA, but also the process outlined in the Public Financial Management Law, the SIGA Law, and potentially parliamentary approval, would be required. One can only anticipate the media uproar that will result from this action.
"Again, at the request of His Excellency, GNPC and the MOF have initiated discussions with LITASCO SA ("LITASCO") to refinance GNPC's outstanding obligations with LITASCO and support other GNPC transactions by leveraging the JOHL stake.
"The Chairman is aware of a series of letters sent to the government of South Africa by the Minister of Mineral Resources and Energy, as well as a meeting conducted in South Africa at which PetroSA was present. Even though PetroSA could exercise rights under the JOA, any such action would not be sanctioned by the Ghanaian government, as stated in the communication.
"During one of the meetings in South Africa, it came to light that the Chairman of the Ghana National Petroleum Corporation (GNPC) has been pressing for PetroSA to preempt the Ghana stake, a position that clearly undermines government policy.
The Herald is also in possession of a letter addressed to Mr. Blay from South Africa by the Chairman of the Board of PetroSA, Nkululeko Poya, and titled "RE: PRE-EMPTION OF JOHL ACQUISITION OF ANADARKO INTEREST."
The message read, "Dear Honorable Blay, Our best regards are extended to you and your team. We are responding to your letter dated April 23, 2023 and titled RE PRE-EMPTION OF JOHL ACQUISITION OF ANADARKO INTEREST.
It stated, "PetroSA is ecstatic that both parties were able to achieve an equitable and amicable resolution to the matter of JOHL's acquisition of DWT interest resulting from Anadarko's sale of its interests in Ghana, through a 50/50 split of the DWT interest held by JOHL.
"PetroSA, and by extension PetroSA Ghana Ltd, acknowledges and agrees that, as part of the conclusion of this transaction, it will give GNPC a formal notice of relinquishing its rights to the remaining DWT interests held by JOHL. We will request the sanction of your Honorable Minister for the transfer of the disputed interest to PetroSA Ghana Ltd.
"We are aware of your extended deadline to close the transaction, which is contingent upon unanticipated or unforeseen delays involving regulatory approvals and its representatives. While we accept this stipulation, we anticipate that both parties will move promptly to ensure that the transaction is finalized within a reasonable timeframe so that both parties can investigate the associated benefits.
"In an endeavor to optimally close the transaction, we appoint Mr. Linda Nene, General Manager of PetroSA Ghana Ltd, as PetroSA's senior responsible owner for this transaction, with Ms. Nombulelo Tyandela as PetroSA's Group CFO.
"In order to expedite the exchange of information, it would be useful to know who GNPC's point of contact for this matter will be.
Moreover, we require access to the dataroom or authentic, certified copies of:
• of the SPA under which JOHL acquired DWT's holdings
• the financial standing of the Joint Account
• all cash demands issued to JOHL on behalf of DWT interests, along with the payment status of each one
• Lifting Allocations for Crude Oil Since Purchase and Sales Receipts
• Other payments invoiced to JOHL DWT must be included with the aforementioned request, along with the Consideration Spreadsheet.