Africa Finance Corp. (AFC) has bought Aker Energy from its Norwegian parents, after recently submitting its plan of development (PoD) in Ghana.
The operator submitted its plan for the Deepwater Tano/Cape Three Points (DWT/CTP) block at the end of last week. CEO Kadijah Amoah said submitting the PoD was a “major milestone”.
The first phase of the plan oversees the development of the Pecan field. Producing the field would involve a FPSO in the ultra-deepwater, with water depths of 2,400 to 2,700 metres.
Amoah said the company had faced “significant challenges” at its project. “We have shown once again our resilience and unflinching commitment to the project. We now look forward to the approval of the PoD so we can get to work, developing and producing the resources for the ultimate benefit of the Ghanaian people,” she continued.
Plans for the Pecan project have been contested previously. The government had issued a deadline of April 14 for the submission of a new PoD.
An AFC representative has confirmed Aker Energy had submitted the plan to the government.
Aker Energy has a 50% stake in the licence, while Lukoil Overseas Ghana Tano has 38%, Ghana National Petroleum Corp. 10% and Fueltrade 2%.
Risk to reward
Aker own a 50.79% stake in Aker Energy while Kjell Inge Rokke’s The Resource Group (TRG) own 49.21%. The two parties have agreed to sell their shares to AFC Equity Investment, owned by AFC.
The buyer has said the management team will remain unchanged. AFC described its move as an earn-out, based on future sales from the Pecan project. The buyer has previously provided $200 million in senior secured bonds for Aker Energy.
“Aker still believes in the resource potential of the DWT/CTP block in Ghana,” Aker president and CEO Øyvind Eriksen said.
“AFC is already invested in this field development and is well-positioned to continue this development. In-line with Aker’s capital allocation priorities, we have thus made a strategic decision to sell our stake in the Ghana assets with an earn-out model as a consideration.”
He described the earn-out as a way to share “the risk and reward” of the project.
“The sale to a reputable African institution, such as the AFC, was considered to be the best way forward to ensure the development of the Pecan field, as well as the whole DWT/CTP block. We are therefore very pleased to have reached this agreement with AFC.”
Sustainable development
AFC president and CEO Samaila Zubairu said the investment was in line with the organisation’s goals.
“AFC will continue to ensure that Africa’s natural resources, including its vast oil and gas reserves, are developed sustainably within the global framework on energy transition and the UN Sustainable Development Goals.”
The DWT/CTP project “has the potential to create jobs, increase government revenues, and spur development in the country”.
Aker will continue to provide technical support for the plan, Zubairu said.
The presence of Russia’s Lukoil in the project has caused some concerns. There have been reports that Lukoil may sell down its stake to an Indian company. However, Russian executives have said they intend to participate in the final investment decision (FID) for Pecan by November this year.