AGM Petroleum block review: Ghana to lose 30% stake to Aker

 

Adnan Adams Mohammed

Government has presented an amended agreement to Parliament to renegotiate the AGM petroleum agreement entered into by the Mahama administration

The amendment, if approved by Parliament, the AGM Petroleum block covering the South Deepwater Tano contract area will be handed to Aker Energy.

But, some stakeholders have expressed grave concerns over the moves by government to renegotiate the AGM petroleum agreement. They are of the firm concern that, Ghana will lose big in the renegotiation.

The amended agreement will greatly short-change Ghanaians. “The new agreement will reduce Ghana’s stake in the block from 48 percent to 18 percent, former Energy Minister, Emmanuel Kofi Armah Buah warned.

His basis for the claim that Ghana is likely to lose 30% stake in the AGM agreement is that, Ghana had 15% of additional interest in the agreement. But, in the new agreement, Government is accepting for Aker Energy to reduce the 15% to 3%. The subsidiary of GNPC under the old agreement had 24%, in this agreement they are taking all that 24% and making it zero. So the GNPC subsidiary will not have any stake in that block again.

With the additional interest Ghana will not do anything, Ghana only put in the agreement that when the operator discover the oil and we are sure of the oil, we will buy 15% stake.

Also, per the old agreement Ghana’s royalty was 10% and that as a result of the changing of the law under the NDC, the minimum negotiating point is 15% which showed the renegotiation of the amended agreement.

According Mr Buah, from his initial calculation, they are reducing Ghana’s stake in the amendment from 48% to 18% to” to favor Aker Energy.

“It is a pattern of this government somehow siding…always being on the side of big business against ordinary Ghanaians and it is a pattern that we have to be concerned about,” Mr Buah stated.

“Now somebody has to come and explain to the people of Ghana how our stake, a country that is struggling so much for money will reduce its stake from 48% to 18%. We need to understand,” he required.

Consequently, Ranking member of the Mines and Energy Committee, Adam Mutawakilu has questioned why the state's interest in the deal will be slashed from 48% to 18%”as a result of the review of the contract.

Boakye Agarko, then Energy Minister, on 26 June 2018, wrote to the company declining the review because it was not in the interest of government.

Mr Mutawakilu said the AGM agreement signed in 2013, has been reviewed by Energy Minister, John Peter Amewu and will prove to be costly to the Ghanaian tax payer.

He questioned why the Akufo-Addo-led government is fleecing the state through the award of dubious oil contracts and review of terms inimical to the country.

“With this new agreement, the stake of the government or the state in the sharing of the oil after royalties and cost is 18%, a reduction of 30 per cent.

“There is a grand agenda by Nana Akufo-Addo to rob the people of Ghana billions of dollars with this renegotiated or amended agreement,” he said.

According to him, the Minority has a serious “reservation” to the changes which are not positive but to the detriment of the country."