Petroleum Commission signs four 3D seismic acquisition agreements

Agreements were signed with four international companies

The Petroleum Commission (PC) has signed four agreements with international companies to secure advanced geological data – 3D seismic data – on the country’s oil reserves, local content director Kwaku Boateng said.

Agreements have been signed with four international companies: Petroleum Geo-Services (PGS), Exploro Geo-Services, TGS-TG-GeoPartners and one other company as part of a multi-client data initiative. The data acquisition initiative is expected to cover all sea basins.

These transactions reflect the Commission’s proactive efforts to enhance understanding of Ghana’s oil reserves and increase investor confidence.

Mr Boateng said the establishment of the geological oil potential will demonstrate to investors the potential of the country’s oil reserves and thus attract more investment into the Ghanaian oil sector.

“We also encourage existing investors to invest in data acquisition – such as Tullow, who recently acquired 4D seismic data at the Jubilee field… particularly in the Tano area,” he added.

In addition, he said, while the oil and gas fiscal regime is good, the Commission is seeking to introduce changes that will adjust the fiscal elements that apply to a specific oil block – known as block categorisation. This includes the bottom block, water depth, potential reserves, data coverage and other elements of the block.

This means that blocks deemed riskier will be subject to generous tax regimes to encourage companies to invest, while blocks with high potential and lower risk will be subject to strict tax regimes, as opposed to the current “one-size-fits-all” tax regime.

Ongoing fiscal reforms aim to attract new investment and address issues with the existing fiscal system, and are seen as necessary amid growing concerns about the energy transition and its attendant negative impact on investment.

The local content director, who was interviewed on the sidelines of the 3rd African Energy Summit in Accra, added that the Commission was also considering new measures, such as replacing the fixed royalty rate system with a more progressive, two-tiered royalty system.

Other changes include a review of additional oil supply allowances, minimizing front-end charges and rationalizing the state’s share.

Responding to concerns about the inability to secure new petroleum agreements (PAs) since 2018, Mr Boateng highlighted efforts to encourage existing operators to invest more in exploration, drilling and production activities. Regulatory requirements are being reviewed to make them more flexible and attract new investment, he added.

It would be recalled that the Public Interest and Accountability Committee (PIAC) and other civil society actors have called on the country to immediately invest in data and regulatory reforms in the oil and gas sector.

The decision comes as the country grapples with a continuing decline in oil production and struggles to attract new investment, with the total number of PAs now at 14.

A lecturer in Energy Law at the Faculty of Law, University of Professional Studies (UPSA) and the Ghana Bar Association (GBA) representative on the PIAC case, Ms Yorm Ama Abledu, said Ghana has significant hydrocarbon resources but is at a crossroads.

“The promise of oil and gas potential raised hopes for economic transformation and increased regional stability when commercial production was announced in 2011. Yet amidst this opportunity, we face a daunting reality: challenges that hinder Ghana from fully realizing its oil potential.

“Today we face a critical question: why has Ghana struggled to attract large-scale oil and gas projects in recent years? This investigation is not merely academic, but goes to the heart of Ghana’s potential and its path towards energy security and economic prosperity,” said Ms. Abledu, who was a special guest at the Summit.

Her speech at the Summit highlighted the need for urgent reforms, including in the local oil and gas sector.

For example, she added that with the rising costs of oil and gas projects, high-quality data on designated blocks is crucial to encourage investors to put money into it.

“In the case of Ghana, because its basins are not largely risk-free, there are significant data gaps and poor data quality. This has made the data unreliable and led to low investor confidence in its blocks. This was one of the many reasons why many IOCs withdrew their bids in Ghana’s first bidding and licensing round in 2018.”

The 3rd Africa Energy Summit was organised by Offshore Africa Magazine under the theme “Africa and the New World Energy Order”.

The CEO of Offshore Africa Magazine, Mr. Gilbert Da Costa, in his speech at the event also stated that the forum provides a platform to analyze trends in the oil and gas sector and ways to address emerging challenges.

“This is because it is an industry that has the potential to change the course of history in Africa. It provides a lot of resources,” he said.