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Sale of Anadarko/Occidental assets: GNPC seeks to increase stakes in TEN and Jubilee blocks

Ghana National Petroleum Corporation (GNPC) has moved strategically in recent times to increase its stakes in the country’s oilfields

As part of the government’s new focus to up Ghana National Petroleum Corporation’s (GNPC’s) stake in Ghanaian oil blocks that are in at least the development stages, the national oil company is being offered a 7% stake in the TEN and Jubilee fields formerly owned by Anadarko.

This is to be paid for by GNPC at a pro-rata price, based on the valuation given to the corporation under the terms of the deal.

Sources close to the deal also say that the transaction with the other party will see GNPC’s shares in the TEN and Jubilee producing blocks increase significantly.

Meanwhile, information available to indicates that Anadarko/Occidental are in the advanced stages of concluding negotiations with another international oil company on all its assets in Ghana.

What is left to conclude, our sources say, is official consent from the Government of Ghana. The information is that this may be done in the coming week.

The battle continues, unabated

Nonetheless, the trench warfare is said to be continuing between the companies engaged in the battle for the stakes in Ghana’s Jubilee and TEN (Tweneboa, Enyenra and Ntomme) oilfields. Kosmos Energy has been leading the pack for many months.

Reports say that in mid-September, in an attempt to get final approval from the Energy Ministry, Kosmos offered the 7% stake in Jubilee and TEN.

Meanwhile, however, a new arrival has joined the battle with an offer that appears to be even more attractive for the state-owned GNPC.

Executives from the local oil firm Springfield Energy, led by Kevin Okyere, are said to have met the GNPC chief executive, Kofi Koduah Sarpong, in September to present an offer that would give GNPC a 7% stake in the fields at no direct cost to itself.

In a confidential letter to Sarpong dated 20 September, Okyere went further, offering GNPC a 10% stake in the fields at no charge to itself and agreeing to drop its claim to US$37 million still owed Anadarko by the Ghanaian state.

The state-owned company needed only to convince the Ministries of Finance and Energy to accept the deal. Springfield is said to have estimated in its letter that Anadarko’s former 24% stake in Jubilee and its 17% interest in the TEN fields was worth $750 million in total.

Vicki Hollub, chief executive of Occidental, previously said she was confident the company would raise about $700 million from asset sales to reach a near-term goal.

While Hollub has not specified which assets are being actively marketed, the Ghana stakes were earmarked for sale on the company’s books as of 31 December, according to a 10-K filing with the Securities and Exchange Commission.

Options differ

Asset sales are a key part of Occidental’s strategy to pay back the debt after long-term borrowing surged nearly five times to more than $48 billion following the 2019 purchase of Anadarko Petroleum Corp.

Occidental has sold nearly $9.2 billion of assets since then, according to data compiled by Bloomberg. Occidental acquired the Ghana assets under the Anadarko takeover.

In a related development, sources in the industry say that GNPC, the Ministry of Energy and partners in the Aker/AGM blocks spent the whole week negotiating in Dubai.

The, sources say the talks were not conclusive. The Government of Ghana is seeking to negotiate the two blocks separately, unlike Aker’s preferred option, which is to sell the two as a whole.

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