The Public Interest and Accountability Committee (PIAC) has been warning the public about a decline in crude oil production since 2018, according to Mark Agyemang, the technical manager for the group.
This comes after a PIAC analysis that showed Ghana’s crude oil output fell in 2023 for the fourth year in a row.
Oil production has drastically decreased, according to Mr. Agyemang, as a result of operational problems as well as governance and regulatory issues. As a result, since 2018, the industry has not seen any new petroleum agreements.
Speaking about the problems with some oil fields on PM Express on JoyNews, he stated that the 2010 start of production at the Jubilee Oil Field runs the risk of running out of oil because of operational difficulties.
“Jubilee has been in production for 12 or 13 years. It is anticipated to live for 25 years. It’s currently more or less halfway through its manufacturing life. Therefore, as reservoir pressure is dropping, a decline is to be expected.
In order to bring additional oil onto the stream, they must sort of take artificial procedures like gas injection, water injection, or the like.
Furthermore, according to Mr Agyeman, the Tweneboa Enyenra Ntomme (TEN) Oil Field management has acknowledged operating difficulties to PIAC and is attempting to resolve them.
The majority of the fields in Sankofa and GyeNyame are gas fields. Since gas and oil are related, you create more gas than oil. Thus, it is typical to anticipate that Sankofa and GyeNyame Fields will produce less oil than TEN and Jubilee,” the speaker stated.
In terms of governance, Mr. Agyemang thinks Ghana has not learned from its first licencing round—the event in which a government agency leases exploration and production companies acreage for their use, usually in exchange for a price and a work or performance commitment.
The low quality of data and the limited size of blocks leased to different businesses for oil exploration and production, he noted, have significantly harmed the sector’s ability to attract investors. This was discovered through collaboration between PIAC and CSOs.
“The industry participants had to incur additional costs to process and enhance the 2D data to 3D or 4D quality if they were able to obtain the low-quality, 2D data that was provided by the industry stakeholders. Thus, they avoided that, according to Mr. Agyemang.
He also pointed out that supermajors like Total, Shell, ExxonMobil, and others have been calling for larger block sizes for years, but their requests have gone unanswered.
“Under the direction of the energy ministry, our nation has conducted road shows. We have taken the same kind of data and block sizes with us to South Africa, Norway, and OTC in Houston. Indeed, and you won’t be able to draw the proper kind of investment into the market with this energy shift hanging over us.
We haven’t signed any new petroleum agreements since 2018. During the course of the time we are discussing, the petroleum agreements of four firms have really been revoked or cancelled. Neither new businesses nor new production fields have been added to the stream. You therefore undoubtedly anticipate that it will deteriorate with time.
PIAC 2023 Report
According to the research, which shed light on events in the upstream petroleum industry, the production of crude oil fell “from a peak of 71.44 million barrels in 2019 to 48.25 million barrels in 2023.”
This indicates a 9.2% average annual drop.
Out of the 48 million barrels, the Jubilee Fields accounted for 63%, SGN for 23%, and TEN for 14%.
“The three producing fields produced a total of 48,247,036.61 barrels (bbls) for the year 2023: Jubilee produced 30,444,217 barrels (63%); TEN produced 6,716,278 barrels (14%); and SGN produced 11,086,541.61 barrels (23%).”
In 2023, the SGN Field (127,203.02 MMSCF, 50%), Jubilee (77,900.05 MMSCF, 30%), and TEN Fields (50,068.90 MMSCF, 20%) produced 255,171.97 MMSCF of raw gas in total. During the period under review, the Ghana Group averaged US$78.067/bbl for all three (3) producing fields.
In light of this, the committee suggested that the government and the pertinent regulatory agencies take the necessary actions to assure investments in underutilised fields and to stop the production decline in currently operating fields.