Eni, Vitol advance plans for two Tano Basin offshore blocks

 

Eni Ghana and Vitol Upstream Tano Ltd have moved closer to exploring two offshore blocks in Ghana’s Tano Basin, in a development that could open a new pipeline of upstream investment in the country.

The companies have signed Memoranda of Understanding with the Government of Ghana covering GH WB 3 and GH WB 8, paving the way for the finalisation of Petroleum Agreements for the two blocks.

The acreage covers about 2,100 square kilometres, with water depths ranging from 750 to 2,800 metres.

The MoUs were signed by the Minister for Energy and Green Transition, John Jinapor, on behalf of the government, with executives from the Ghana National Petroleum Corporation (GNPC) witnessing the signing.

For Ghana, the agreements represent another step in efforts to attract investment into the upstream petroleum sector and expand exploration activity in the Tano Basin.

The two blocks are particularly relevant to the companies’ existing operations in Ghana. Eni said the opportunities fit its nearfield and Infrastructure-Led Exploration strategy, which seeks to use existing infrastructure and proximity to producing areas to develop new exploration prospects.

That approach could give the proposed exploration programme an advantage by allowing potential discoveries to be connected to infrastructure already serving established production areas, subject to commercial and technical feasibility.

The latest agreements follow a Memorandum of Intent signed by the parties last year and deepen Eni and Vitol’s commitment to Ghana’s upstream industry.

Building on existing operations

Eni has been active in Ghana since 2009 and currently has equity production of about 40,000 barrels of oil equivalent per day.

The company operates the Offshore Cape Three Points (OCTP) project, with a 44.4% interest. Vitol holds 35.6%, while GNPC has a 20% stake.

The companies’ existing presence in the country gives them familiarity with Ghana’s offshore operating environment and access to infrastructure that could potentially support future developments.

However, the economic value of GH WB 3 and GH WB 8 will ultimately depend on the outcome of exploration. The signing of the MoUs does not by itself establish the presence or commercial viability of recoverable petroleum resources.

The next step is therefore the conclusion of the Petroleum Agreements, after which the companies can proceed with the relevant exploration activities under Ghana’s petroleum laws and regulatory framework.

Fresh investment opportunity

The development comes as Ghana seeks to maintain investor interest in its upstream petroleum industry while ensuring that new investments contribute to the effective development of the country’s petroleum resources.

For Eni and Vitol, the two blocks offer an opportunity to extend their exploration footprint around an area where they already have producing assets and operational experience.

For government, successful exploration could eventually add to Ghana’s petroleum resource base, attract additional capital and generate economic activity across the wider oil and gas value chain.

The partners have also undertaken projects in Ghana covering training, economic diversification, water and sanitation, and access to energy.

For now, however, the immediate focus is on completing the Petroleum Agreements and determining what lies beneath the two offshore blocks.

The MoUs mark progress in that process, but the more significant commercial milestone will come if exploration confirms resources capable of supporting future production.