More African Countries Opt For Nuclear Power Plants

Michael Creg Afful
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More African Countries Opt For Nuclear Power Plants
Africa will, by 2030, witness an increase in the number of nuclear power plants as several countries have begun processes to join nuclear power producers in the world. The demand for electricity across Africa is expected to grow many times by 2050. And in a bid to meet the demand and also drive industrialisation, most countries believe nuclear power is the best option to achieve this goal. So far, only South Africa operates nuclear power plant at Kornberg. Last year, Egypt awarded a contract to Rosatom, a Russian nuclear power firm, to build a 4.5 Gigawatts (4500Megawatts) power plant and it is expected to begin soon. Seven other African countries namely Ghana, Kenya, Nigeria, Morocco, Tunisia, Sudan and Kenya have advanced in processes towards establishing nuclear power plants by 2030. An article published by energy for growth noted that seventeen other African countries have also taken steps towards becoming ready and could be potential markets by 2050. Recently, the European Union made a proposal that recognises gas and nuclear power as green energy. Although this proposal has divided the Union block, some industry players especially those in developing countries,  have welcomed the move. In an interview with GNA, Dr Stephen Yamoah, Executive Director of Nuclear Power Ghana (NPG), described the EU’s proposal as a positive development and good news for Ghana. He said the development means more countries are realising the important role that nuclear plays as a sustainable and environmentally friendly energy source. “Nuclear is certainly green and that is not debatable. Nuclear does not emit CO2 and it is one of the surest ways we are to decarbonise the environment.”     Source: https://energynewsafrica.com

Ghana: Two TOR Workers Crashed To Death (Photos)

Michael Creg Afful
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Two staff of Tema Oil Refinery (TOR) who worked at the Security Department of the refinery met their untimely death on Wednesday in a bizarre accident on the Accra-Tema motorway when they were on their way to work. The deceased, Moses Anawe and Felix Agyekum, were said to have been working in the refinery for over twenty years. They were said to be travelling from Accra in a saloon car to work when the accident occurred at about 5:30 am on Wednesday. According to sources within the refinery, a Sino Tipper Truck with registration number GN-6708-21 , fully loaded with sand from Tema and heading to Accra on the section of the motorway, knocked a vehicle which overtook the truck and crossed the median of the road to crash the victim’s Opel Astra with registration number GW 5819-10 on the other side of the road, killing them. The remains of the deceased are currently at the Tema General Hospital morgue. The sad development has affected the morale of the security personnel at the refinery. The driver of the truck is currently is in the grips of the Airport Police. Source: https://energynewsafrica.com

GNPC :GNPC Commences Third Phase 2D Seismic Data Survey On Voltaian Basin

Michael Creg Afful
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Ghana’s National Oil Company (GNPC) has commenced a further 2D seismic data survey on the West African nation’s unexplored Voltaian Basin. The company awarded a contract to a Joint Venture Chinese firm, BGPBAY in December last year to undertake the studies. GNPC has already acquired several Regional 2D seismic data over the basin, processed and interpreted the data about a year ago. However, the company wants another phase of 2D seismic to be undertaken because the first and second phases of 2D data covered a bigger area of the basin and were regional in nature. Deputy Chief Executive Officer of GNPC, Benjamin Kweku Acolatse told energynewsafrica.com that the company has identified two areas, in the north and southern areas of the basin and is planning to acquire a further 1655 line kilometers of closely spaced 2D seismic data within the two areas for the third phase of the study.
Mr Benjamin Kweku Acolatse, Deputy CEO of GNPC in -charge of Finance and Administration
He continued that “when the third phase of 2D seismic survey is completed, we will interpret the results, integrate this with the geochemistry information which would also help us identify more leads within the two areas. He said the company would move a step further to undertake 3D seismic data acquisition after the successful completion of the ongoing studies. He said the company is hoping that they should be able to start an onshore well drilling campaign in 2023 and drill some wells to test some prospects that would be identified in the area. “After the 3D, we will open our doors for partnership with international oil companies which are interested in partnering with us to further explore the basin,” Mr Benjamin Acolatse stated. According to him, GNPC is determined to push its operatorship agenda through the Voltaian Basin. So far, several potential leads have been delineated in the Voltaian Basin and energynewsafrica.com can confirm that the Government will complete the demarcation of blocks for open competitive bidding in the not too distant future. However, two blocks have been reserved for exploration by the government for the state-owned Ghana National Petroleum Corporation which aims to engage in exploration activities in collaboration with an established international oil firm to acquire the requisite expertise and experience to evolve into a major upstream operator itself over the coming years.   Source: https://energynewsafrica.com

Nigeria: NSIA To Provide $24Million For Solar Power Naija Programme

Michael Creg Afful
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The Nigeria Sovereign Investment Authority (NSIA) is set to finance the assembly and deployment of 200,000 solar home systems (SHS) across West African nation. The sovereign wealth manager will provide $24 million (₦10 billion) under the “Solar Power Naija” programme. NSIA will partner with the Rural Electrification Agency (REA) to deploy the solutions. The Nigerian Ministry of Power will provide technical and advisory support to NSIA in this process. The Solar Power Naija program is an initiative of the Federal government that aims to provide energy access to 5 million households, or 25 million Nigerians in rural areas and underserved urban areas. The program also aims to create about 20,000 manufacturing, assembly, and installation jobs, leading to the deployment of over 500,000 SHS by 2023.

https://energynewsafrica.com/index.php/2021/11/13/bpa-is-looking-for-investors-to-develop-renewable-energy-projects-ceo/

      Source: https://energynewsafrica.com

 

 

Uganda: Engie Inaugurates 600 kWp Solar Mini-Grid On Lolwe Island

Michael Creg Afful
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Engie Energy Access, a subsidiary of the French group Engie, has commissioned a solar mini-grid on Lolwe Island in Uganda. This project, which will be followed by others, was implemented through a joint venture with Equatorial Power, a company based in the Ugandan capital Kampala. Access to electricity for the people of Lolwe is now guaranteed. This change is due to a solar mini-grid recently commissioned as part of a partnership between Engie Energy Acces, the subsidiary of French giant Engie, and Equatorial Power, a company based in Kampala, Uganda. The solar power plant recently commissioned by the Engie Equatorial joint venture has a capacity of 600 kWp. The plant is connected to an electricity storage system, and distributes electricity via a mini-grid on Lolwe Island, located in Lake Victoria, the largest lake on the African continent, covering more than 68,000 km2. The mini-grid supplies 3,000 households on the island. The Lolwe mini-grid also provides electricity to 700 businesses. The facility also has an industrial site with a pumping station, water distribution and purification plant, as well as fish drying facilities and ice-making facilities for preserving fish products before export to the rest of Uganda and abroad. “For us, electricity is not an end in itself, but a means to provide other essential services such as clean water, agribusiness and electric mobility. It is this vision that we believe will have a real impact on rural communities and bring sustainable financial and social development to the African continent,” says Riccardo Ridolfi, CEO of Engie Equatorial. In Lolwe, the joint venture is acting as an incubator, financing the installation of energy-efficient equipment and machinery to help the development of this remote community. The company plans to replicate this model of sustainable development infrastructure in other localities in the Lake Victoria region. Gillian-Alexandre Huart, CEO of ENGIE Energy Access, comments: “The Lolwe mini-grid’s distributed renewable technology and integrated business model will significantly improve the lives and economic perspectives of the underserved communities living far from the grid. The Lolwe mini-grid is setting the stage for the next generation of decentralized energy infrastructure, and will help to accelerate universal energy access.”       Source: https://energynewsafrica.com             Source: https://energynewsafrica.com

Ghana: Tullow Ghana Signs MoU With Ghana Navy To Provide Security For Jubilee And TEN Oil Fields

Michael Creg Afful
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Tullow Ghana Limited, the lead operator of Ghana’s Jubilee and TEN oilfields, has signed a Memorandum of Understanding (MoU) with the Ghana Navy to provide security services at the two oil fields for five years. According to a press statement issued by Tullow Ghana Ltd, the Jubilee partners will provide a total of 23.5 million dollars during the five-year contract period. The statement said a vessel has been acquired for the Ghana Navy with funding from the GCB Bank, explaining that it will provide asset protection in the Exclusive Economic Zone (EEZ) in the TEN and Jubilee fields. The five-year contract commenced on 1st January 2022 and will run until 31st December 2026. The Deputy Managing Director, Cynthia Lumor said, “The Jubilee partners’ commitment to supporting the retooling of the Ghana Navy is mutually beneficial to both parties. “This partnership will ensure the protection of the Ghanaian waters by providing security services in the TEN and Jubilee fields and along the coast of Ghana. We believe that this will further strengthen the relationship between Tullow Ghana and the Ghana Navy.” Chief of the Naval Staff, Rear Admiral Issah Yakubu commended the Jubilee partners for the collaboration, saying: “Tullow Ghana and the Jubilee partners have demonstrated commitment to sustainable production by this collaboration. “The Ghana Navy will ensure that we fulfill our contractual obligations to ensure a secured maritime space for the safe operation of the TEN and Jubilee fields.”   Source: https://energynewsafrica.com

Kenya: Fuel Prices Remain Unchanged Despite Drop In Landed Cost

Michael Creg Afful
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Kenya: Fuel Prices Remain Unchanged Despite Drop In Landed Cost
Consumers of fuel in Kenya will not enjoy any reduction in fuel prices at the pumps despite a drop in the landed cost of the commodity. This is because the East African nation’s Energy and Petroleum Regulatory Authority (EPRA) has retained pump prices for petroleum products despite a drop in the landed cost. The landed cost of imported Super petrol decreased by 4.1 per cent from US$627.80 (Sh71,206) per cubic metre in November to US$601.97 (Sh68, 276) in December. Diesel decreased by 5.71 per cent from $600.22 (Sh68,078) to US$565.92 per cubic metre, while kerosene decreased by 4.89 per cent to US$574.85 (Sh65,194) per cubic metre. A litre of petrol currently retails at Sh129.72 (US$1.14) in Nairobi, while diesel is sold for Sh110.60 (US$0.97) per litre. Kerosene is being retailed at Sh103.54 per litre. EPRA Director-General, Daniel Kiptoo said the government would utilise the Petroleum Development Levy to cushion consumers “from the otherwise high prices. “The prices are inclusive of eight per cent VAT in line with provisions with the Finance Act and the revised rates of excise duty adjusted for inflation,” Kiptoo said. This comes amid concerns by Oil Marketing Companies (OMCs) over the government defaulting on compensation under its fuel subsidy initiative introduced mid-last year. In November, the Energy and Petroleum Regulatory Authority cut margins for the oil marketers to keep pump prices unchanged after a public outcry on rising pump prices. Billions of shillings, however, remain unpaid, leaving OMCs’ cash flow dented. They now want the government to pay interest on the delayed funds, a cost that will be passed to taxpayers.     Source: https://energynewsafrica.com

Judgement Debt: Khawar Qureshi QC Calls For Capacity Building For African Lawyers

Michael Creg Afful
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Judgement Debt: Khawar Qureshi QC Calls For Capacity Building For African Lawyers
Africa is seen as one of the best investment destinations as the continent continues to attract investors from other parts of the world. One of the sectors that have attracted massive investment is the power and oil sector due to the important role they play in the running of the economy. With the influx of investors into the continent, one thing that African governments should be mindful of is the possibility of litigation between government and investors. Sadly, African nations have not paid attention to building the capacity of lawyers working in various government institutions to be able to help in drafting contractual agreements and also to defend or advise the country in an event of a dispute. According to a report by Bettina Muller and Cecilia Olivet at Trans National Institute(tni.org), an international research and advocacy institute, by the end of August 2019, African states were hit by a total of 106 known investment treaty arbitration claims. The figure represents 11 per cent of all known investor-state disputes worldwide. The report noted that African states were the main losers in the investment arbitration cases. The African continent, which had been struggling to develop, lost a total of US$ 55.5 billion as claimed by investors since 1993. The claimant includes power and oil and gas investors. The report cited European investors as those who initiated the majority of the lawsuit against African countries, accounting for 70 per cent of all cases Speaking to an international commercial lawyer and Queens Counsel, Khawar Qureshi, who has been in practice for 30 years and has acted for and against around 80 States, including many African States such as Zambia, Uganda, Ghana, Botswana, Kenya throughout his career, he proposed solutions to enable African governments to prevent or deal more effectively with disputes between them and investors. He suggested that the first thing African states should do when signing contract with foreign investors is to ensure due diligence. ” I make no criticism of any Government in particular. Nevertheless when any party enters into a contract,  it must ensure due diligence is undertaken. Is  the contract commercially necessary and viable? Has it been drafted to provide reasonable protections or is it one sided? The contract has to be reviewed and drafted with expertise and when a dispute arises you must make sure it is handled by knowledgeable professionals. “If a dispute is about to occur, make sure you have the best legal advice available,” he added. Khawar Qureshi QC further suggested capacity building for African lawyers for them to be aware of and able to deal with emerging issues. He noted that capacity building for lawyers who handle government contracts and disputes can be more effective, saying: “In my international practice as a Queens Counsel, I ensure that when I work for a government, I help in capacity building by training government lawyers.” Khawar Qureshi QC was instructed to advise the Government of Ghana after the GPGC arbitral award was handed down. Click on the link below to watch the interview:

Nigeria: Power Producers Lose US$3.93 Billion In Seven Years Over Unutilised Electricity

Michael Creg Afful
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Power producers in the Republic of Nigeria lost at least N1.632 trillion (US$3,939,269,539.20) between 2015 and 2021 over the lack of full evacuation of generated electricity on the national grid causing stranded power of 27,204 Megawatts (MW).

According to the Daily Trust report, data from the Association of Power Generation Companies (APGC) showed that about 25 active GenCos had over 15,000 megawatts (MW) of stranded generation capacity at the end of 2021.

Given the breakdown of the figure, Daily Trust noted that the GenCos had 63,339.02MW of available power generation within the seven years, however, just 32,778.98MW of power was generated and evacuated through the Transmission Company of Nigeria (TCN) network to the Distribution Companies (DisCos) network for supply to consumers.

This means there was a balance of 27,204.5MW, representing about 30 per cent of available capacity which was stranded during the seven years.

This stranded power translated to N1.632 trillion market losses during the period, the data showed.

The analysis of the data on yearly revenue losses showed that from 2015 to 2021, the highest loss of N273.32 billion was recorded in 2016 when the GenCos could not deliver 3,828MW to the grid even when it had 7,040MW capacity.

The second highest stranded power was recorded in 2020 when the GenCos recorded a N266.1 billion loss over 3,742MW stranded power from an overall 7,793MW generation capacity.

In 2018, N264 billion was lost due to 3,699MW stranded power; the power generation companies then lost N256.9 billion in 2019 when they could not get 3,599MW of electricity to the consumers due to transmission and distribution network challenges.

Another N236.4 billion was lost in 2017 as the GenCos recorded 3,312MW stranded power while 3,010MW stranded electricity caused a loss of N214.9 billion in 2015.

The least of the stranded power and its losses were recorded just in 2021 when 2,248.5MW could not be delivered to the grid due to the grid hiccups causing a loss of N120.2 billion, which is about half of the revenue lost in each of the previous six years.

Commenting on the weak transmission and distribution network, a power sector expert, Dr Joy Ogaji, in an outlook report for this year, held that: “Reliability has been discovered to be a function of infrastructure and proper metering guarantees accurate billing. While some stakeholders have opined that the illiquid state of the NESI is the core challenge, we believe the liquidity crisis is not the problem, but a key symptom of the problem and can be solved.

“Hence, we expect an increased focus on the provision of required infrastructure as well as ensuring infrastructural handshake between the TransCo (TCN) and the DisCos,” she noted.

 

 

Source: https://energynewsafrica.com

Ghana: Fuel Price Hits Ghc7 Per Litre (Updated)

Michael Creg Afful
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Ghana: Fuel Price Hits Ghc7 Per Litre (Updated)
Majority of Oil Marketing Companies in the Republic of Ghana have adjusted their fuel prices at the pump. GOIL Company Ltd, indigenous leading oil marketing company adjusted fuel price by 20 pesewas. Super X (Petrol ) is now sold at Ghc 6.85 per litre  from Ghc6.65 per litre while Diesel X is sold at Ghc 6.85 up from Ghc6.65 per litre. TotalEnergies is selling Diesel (gasoil) at Ghc7.05 per litre from Ghc6.85 per litre while petrol (gasoline) is sold at Ghc6.99 per litre from Ghc 6.80. Shell is selling petrol at Ghc6.97 per litre while diesel is being sold at Ghc 6.95 per litre. Several other OMCs including Puma Energy have adjusted fuel prices upward. Crude oil prices on the international market have been soaring since the beginning of January 2022 after falling below US$80 per barrel in December 2021. As of Wednesday, Brent crude was trading at $88.01 per barrel while West Texas Intermediate (WTI) was trading at US$86.11 per barrel. In a statement issued last Thursday, the energy think tank, Institute for Energy Security, predicted that fuel prices on the local market were likely to hit Ghc7 per litre. The IES projection was based on the 7.42 per cent increase in the price of Brent crude, the 9.46 per cent increase in the price of gasoline, the 8.52 per cent increase in gasoline price and the 0.3 per cent depreciation of the local currency against the US dollar. “The coming pricing window which starts on Sunday may see the price of petrol and diesel go up on the local market. This is on the back of happenings on the international market. Over the past two weeks, Brent Crude Oil has moved from about US$77 to about US$83 per barrel, representing an increase of about eight per cent while the price of gasoline increased by 9.46 per cent to close the window at US$774.94 per metric tonne. The price of gasoline also increased within the period by 8.52 per cent to close trading at US$696.00 per metric tonne from its earlier price of US$641.38 per metric tonne. “Since we are price takers, these happenings on the international market will impact the local market. Though the cedi depreciated marginally against the US Dollar, it won’t make a big change. We are, therefore, likely to see diesel and petrol selling at around GH¢7 per litre for the first time,” Nana Amoasi VII, Executive Director of IES, said in an interview with the media.       Source: https://energynewsafrica.com

Emissions Set To Rise With Global Power Demand – IEA

Michael Creg Afful
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Global electricity demand over the next few years is set to slow after a record 2021 but will still result in higher carbon emissions without rapid gains in low-carbon supply and energy efficiency, the International Energy Agency (IEA) said on Friday.

Global electricity demand rose by 6% or 1,500 terawatt hours (TWh) in 2021, the largest percentage gain since the recovery from a global financial crisis in 2010 and the largest total rise on record, the agency said in its annual report on the electricity sector.

China accounted for about half of the increase in global electricity demand last year with a 10% rise.

However, global electricity demand is expected to slow in the next few years as energy efficiency measures take effect and economic recovery slows.

It is forecast to increase by 2.7% on average to 2024, though the effects of the coronavirus pandemic and high energy prices are still uncertain, the report said.

South East Asia is expected to see the strongest electricity demand, growing by an average 5% between 2022 and 2024, followed by the Asia Pacific region, which includes China, at around 4% over that period, slightly below pre-pandemic levels.

Demand in North America and Latin America, is seen rising by around 1% over 2022-2024, with the largest percentage gains in Mexico and Canada at 3-4% a year.

Europe is set to register 1.7% growth in 2022 and then stay flat in 2023 and 2024.

Expected power demand growth in terawatt hours by region EMISSIONS

Power sector carbon dioxide emissions climbed 7% to a record high in 2021 after falling the previous two years.

Although slower electricity demand growth and the rise of low-carbon generation should limit emissions growth to less than 1% per year between 2022 and 2024, emissions need to fall sharply to meet net zero targets by 2050, the report said.

To fulfill its role in de-carbonizing the energy system, the electricity sector needed big improvements in energy efficiency and low-carbon supply, IEA said.

Fossil fuel generation is set to stagnate over the next three years while renewables are expected to grow 8% per year through 2024, and account for over 90% of total demand growth over that period.

Commenting on the report, David Jones, the global lead for independent climate think tank Ember said: “Failure to build enough new clean electricity to keep up with demand will slow the phase-out of coal-fired and gas-fired electricity; a mistake we cannot afford to make for the climate.”

On the electricity supply side, most of the growth to 2024 is expected in China, accounting for around half of the net total increase, followed by India at 12%, Europe at 7% and the United States at 4%.

Last year, a surge in consumption, combined with a reduced natural gas and coal supply, resulted in volatile power prices and negative effects on power generators, retailers and end- users in China, Europe and India, the IEA said.

The IEA’s price index for major wholesale electricity markets in 2021 nearly doubled compared to 2020, up 64% from the average over 2016 to 2020. In Europe, fourth quarter 2021 prices were over four times the 2015-2020 average.

“Sharp spikes in electricity prices in recent times have been causing hardship for many households and businesses around the world and risk becoming a driver of social and political tensions,” said IEA Executive Director Fatih Birol.

The IEA did not provide detail on where price volatility might be most concentrated over the next few years.

 

  Source: Reuters

 

Ghana: GNPC Battles ACEP…Denies Setting Up Jubilee Oil Holdings In Cayman Islands

Michael Creg Afful
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Ghana: GNPC Battles ACEP…Denies Setting Up Jubilee Oil Holdings In Cayman Islands
Ghana’s National Oil Company (GNPC) has denied claims by energy think tank, African Centre Energy Policy (ACEP) that it has set up an offshore company named Jubilee Oil Holdings in Cayman Islands in North America to take up the seven percent interest it recently acquired from Kosmos Energy in the Jubilee and TEN oil fields. In a statement responding to the claims by ACEP at a press conference last Thursday, GNPC said the Jubilee Oil Holdings was not set up by GNPC but rather Anadarko Offshore Holdings Company LLC.  “The Corporation has not set up any offshore company. The facts of the matter are as follows: Anadarko Offshore Holding Company LLC (“Anadarko Offshore”) sought to wind up its operations in Ghana. Its subsidiary, Anadarko WCTP Company (“Anadarko WCTP”) (an offshore company registered in Cayman Islands that holds Anadarko’s interest in Jubilee, Deepwater Tano (DWT) and West Cape Three Points (WCTP)) was to be sold to Kosmos Energy Holdings Ghana Limited (“Kosmos”). The Corporation expressed an interest in acquiring part of Anadarko WCTP’s interest in the DWT and WCTP petroleum agreements and notified Ministry of Energy. The parties entered negotiations to determine the Corporation’s share, and it concluded with an offer to the Corporation to purchase the seven per cent commercial interest.” The GNPC clarified that “to enable the negotiations with Kosmos for the sale of Anadarko WCTP to proceed, Anadarko Offshore incorporated a company, Jubilee Oil Holdings Limited (“JOHL”), in the Cayman Islands to hold the seven per cent commercial interest in the interim while the parties negotiated and finalised the commercial terms of the transaction.” The Corporation indicated that “the parties proceeded to negotiate the commercial terms of the sale and purchase of the seven per cent commercial interest. The headline purchase price as of 1st April 2021 was quoted as US$199 million. This price was adjusted to US$165 million effective 30th September 2021, following adjustments for cash calls, taxes and other expenses incurred as well as sales made by Anadarko WCTP within the period.” GNPC explained further that “Anadarko Offshore, the seller, was eventually paid US$164,798,691.00 on 19th October 2021 in full settlement of the acquisition. Anadarko Offshore thereafter assigned JOHL to GNPC, as JOHL holds the seven per cent commercial interest.” Explaining the circumstances leading to the CEO of GNPC, Dr KK Sarpong, and Board Chairman, Mr Freddie Blay becoming directors of Jubilee Oil Holdings, GNPC said at the time of the sale and purchase, the Corporation was required to nominate two directors to take over after the transfer was effected. The Board of Directors, therefore, nominated the Board Chairman, Mr Freddie Blay, and the Chief Executive Officer, Dr KK Sarpong, as initial directors to replace the directors of JOHL appointed by Anadarko. “The Corporation holds one hundred percent of the shares in JOHL,’’ GNPC stated. The Corporation is currently in the process of transferring JOHL to GNPC Explorco. It was never a ploy by the Corporation to ‘live unto itself, not the law and the nation’s strategy for its existence’ as claimed by ACEP,” the statement noted. Touching on the assertion that that Jubilee Oil Holding Limited cannot transact business in Ghana’s oil industry because it is not registered with The Registrar General’s Department, the GNPC said, “The Corporation is in the process of registering JOHL as an external company in Ghana. “The Corporation continues to operate within the remit of the legal framework and has no intention of flouting any legal requirements and procedures. As the Corporation has always indicated, the Corporation welcomes engagement with any stakeholder in its operations. All documents on the transactions are available for scrutiny and inspection,” the statement concluded. Click on the link below for the full statement issued by GNPC: Press Release-GNPC Responds to ACEP        

 

Source: https://energynewsafrica.com

Ghana: ACEP Blows GNPC CEO, Board Chair’s Cover For Using Tax Haven Company To Take Up 7% Acquisition In Jubilee & TEN Fields

Michael Creg Afful
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Africa Centre for Energy Policy (ACEP), an energy think tank in the Republic of Ghana, has uncovered a deliberate plan by the CEO of Ghana National Petroleum Corporation and Board Chairman, which they believe could result in Ghana being short-changed.

Late last year, the West African nation’s national oil company, GNPC, acquired a seven per cent stake in the Jubilee and TEN oil fields at the cost of US$199 million from Kosmos Energy following the latter’s US$750 million acquisition of Occidental Petroleum (OXY) interest.

In an official communication announcing the acquisition, the company told Ghanaians that the interest acquired would be transferred to GNPC’s subsidiary, the GNPC Exploration and Production Company (GNPC Explorco).

“With this acquisition, GNPC Explorco will become part of the contractor group for the two blocks, together with Tullow, Petro SA and Kosmos (who also bought an additional interest in the two blocks),” the company said in the statement.

However, addressing a press conference in Accra, capital of Ghana, Policy Lead for Petroleum and Conventional Energy, Kodzo Yaotse disclosed that GNPC has set up an offshore company in Cayman Islands, in North America, to receive the seven per cent commercial interest in the blocks.

He said ACEP’s search discovered that a company called Jubilee Oil Holdings registered in Caymans Island with Dr KK Sarpong, CEO of GNPC and Mr Freddie Blay, board chairman of GNPC as directors have been assigned the seven per cent stake acquired from Kosmos Energy in the OXY transaction.

Dr KK Sarpong (left) CEO of GNPC and Mr Freddie Blay (Right) Board Chairman of GNPC

Mr Yaotse indicated that Jubilee Oil Holdings was registered on 21st September 2021.

He described this move as questionable.

He said Ghana stands the chance of losing tax revenue if this is not reversed.

“It is intriguing why GNPC has instead decided to create a subsidiary in a tax haven even if it needed a new subsidiary. Companies hide in tax havens for two popular reasons: secrecy and tax avoidance. Which of the two motivates GNPC?” he quizzed.

Touching on financing of the seven per cent stake, Yaotse described it as worrying that GNPC has not been able to communicate to Ghanaians how it intends to finance the acquisition.

Relying on a report by Africa Intelligence in October 2021, Yaotse said the report noted that the Ghana Revenue Authority (GRA), by extension the Finance Ministry, intends to lend the tax settlement amount from the Oxy transaction to GNPC to offset the acquisition cost of the seven per cent interest with no recourse to the Petroleum Revenue Management Act (PRMA), Act 815 as amended.

According to him, ACEP is in support of an acquisition of the seven per cent interest in the Jubilee and the TEN fields, however, “the right processes must be followed in respect of Ghanaian laws and proper corporate governance practices that project GNPC among its peers on accountability benchmarks.

“How the corporation has become broke from a strong cash position in the early years of oil production is a major subject for government attention…the corporation must find ways to fit into a philosophy that will advance the overall national interest rather than an attempt to evade the dictates of the Petroleum Revenue Management Act (PRMA) with convoluted schemes such as the new efforts to relocate asserts in Ghana to the Cayman Islands,” he added.

Recommendations

Proposing what the think tank believes is the solution to the controversy surrounding the transaction, Mr Yaotse urged the GNPC to seek parliamentary approval to ring-fence the seven per cent interest to guarantee a loan for a short period of 3-5 years to allow GNPC to use revenue from the acquired interest to amortise the loan.

He further recommended that the GNPC holds the interest locally, either directly or through Explore.

Energynewsafrica.com’s source within the corporation indicates that the company is preparing to respond to the claims by the think tank.

 

 

Source: https://energynewsafrica.com

Senate Votes Against Nord Stream Sanctions

Peter Adofo Asante
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The Senate voted 55 to 44 against a proposal for a new round of sanctions against the Nord Stream 2 natural gas project led by Russia’s Gazprom. According to opponents in the U.S. Congress, the project will deepen Europe’s dependence on Russian gas while giving Moscow the opportunity to use gas supplies as a weapon against Europe. “Russia has nakedly and unequivocally used energy as blackmail,” Senator Ted Cruz, author of the measure, said Thursday on the Senate floor, as quoted by Bloomberg. And Russia’s president, Vladimir Putin, had done this “openly, brazenly and laughingly and absolutely nothing happened.” “The government of Germany should have shelved this project itself a long time ago,” Minority Leader Mitch McConnell said. “These sanctions, like the prior Nord Stream 2 sanctions that had overwhelming bipartisan support here in Congress, are not about driving a wedge in Europe. The pipeline itself is the wedge.”  However, opponents of further sanctions argued that it would affect U.S. relations with Germany, which is set to be the biggest beneficiary of the pipeline but only when it approves it, which is going to take at least another few months. There are also German companies involved in the project. The administration, for its part, has argued that sanctions now could limit Washington’s power of persuasion in the future if it decides to work with European allies to impose more severe sanctions on Russia if it invades Ukraine. Germany, meanwhile, has made it clear that the Nord Stream project is an entirely separate issue from events in and around Ukraine. “We should not drag (Nord Stream 2) into this conflict,” Defense Minister Christine Lambrecht said this week, as quoted by Reuters. “We need to solve this conflict, and we need to solve it in talks – that’s the opportunity that we have at the moment, and we should use it rather than draw a link to projects that have no connection to this conflict.”
U.S. Sanctions On Nord Stream 2 Upset European Lawmakers
      Source: Oilprice.com
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