AGM Petroleum Ghana Limited (AGM) has announced that it will start oil drilling activities at the South Deepwater Tano (SDWT) block following the ratification of the AGM Petroleum Agreement by parliament.
“With this ratification, AGM Petroleum Ghana Limited (AGM) can now begin exploring for oil in the ultra-deepwater block, over 3.5 kilometres below sea level,” a statement from the company which was released on Monday, 6 May 2019, said.
Without providing details, AGM said the terms in the SDWT block are more favourable to Ghana in comparison to recently-approved petroleum agreements in the same region.
AGM added that the petroleum agreement ratified by parliament on 3 May 2019, gives a fiscal take to Ghana, which is substantially above the international deepwater average of approximately 55%.
“We are grateful for the opportunity given to us to explore for oil and gas in the SDWT block together with our partners. We hope and believe this will be the beginning of a long and prosperous journey together with the Ghanaian people that will create wealth and opportunity for generations to come,” Atle Andresen, CEO of AGM, commented.
David Adomakoh, Director of Quad Energy, also said that: “We look forward to a fruitful long-term relationship with AGM and are committed to working together to unlock the potential of the SDWT block. This will give us a unique opportunity to maximise the participation of our local oil and gas services companies.”
Ghana’s Minority caucus in Parliament has raised concerns about the deal which it said will reduce the country's stake in the oil contract from 43 per cent to 18 per cent.
The agreement, signed in 2013, was in 2018 being considered for review by the then-Energy Minister, Mr Boakye Agyarko, who said the agreement was not in the country's best interest.
Mr Agyarko’s successor, John Peter Amewu, however, okayed the renegotiation of that agreement. At a press briefing in Accra on Friday, 3 May 2019, Minority Leader Haruna Iddrisu questioned the essence of the renegotiation.