Jubilee partner, Kosmos Energy, has urged government to facilitate exploration projects for oil companies in the wake of the COVID-19 pandemic.
The fall in oil prices coupled with reduced demand for oil, has taken a toll on the global oil industry and affected players in Ghana’s oil sector.
Having set a benchmark of $58.66 oil price per barrel until the end of 2020, Ghana’s projected oil revenue is set to take a hit, with analysts already predicting the country will get half its projected revenue.
Speaking to Citi Business News after donating an RNA Extraction and swab kits worth $500, 000 to the Ghana Health Service to help the Covid-19 fight, the Senior Vice President and Head of Ghana Business Unit of Kosmos Energy, Joe Mensah, indicated that government’s facilitation will ease the impact of the pandemic on the industry.
“At the beginning of the year, a barrel of oil was sixty dollars. It went all the way down to 20 dollars and even at one point, it went negative. It has come back up between $35 and $40 per barrel, and that is something that we can work with. So, I think government’s help should be concentrated on the small and medium enterprises. That is where the impact is more severe because government now has limited resources. So, they shouldn’t be focusing on blue chip companies. They should be focusing on the small and medium companies,” he said.
He further explained that, “as we are trying to look for areas to further our exploration projects, government can facilitate the process to make it possible for us to do more business. I think it is better than giving us a hand-out. There are nearby fields that are closer to areas we are developing. And if government can give us the permission to take advantage of these lands, it will benefit everyone in the country”.
COVID-19 has sent shockwaves through the economy, including the energy sector.
According to Finance Minister, Ken Ofori-Atta, Ghana will record a significant drop in revenue target for 2020 due to the COVID-19 pandemic.
He said the country is recording a huge decline in revenue from the port, petroleum revenue receipts as well as tax revenue due to economic slowdown being witnessed as the world fights the spread of the virus.
Earlier this year, Kosmos Energy announced that the deepwater Jubilee gas enhancement project was completed in February with subsequent rates of around 90,000 b/d achieved.
The Jubilee field was discovered in June 2007. It is located 60km offshore between the Deepwater Tano and West Cape Three Points blocks in Ghana.
The field’s recoverable reserves are estimated to be more than 370 million barrels, with an upside potential of 1.8 billion barrels. It is located at a water depth of 1,100m.
Equity partners of the Deepwater Tano block are Tullow with 49.95%, Kosmos with 18%, Anadarko with 18%, Sabre Oil & Gas with 4.05%, and Ghana National Petroleum Corporation (GNPC) with 10%.