Interview: Opoku-Ahweneeh Danquah

How can Ghanaian companies benefit from hydrocarbons exploration in the Volta Basin?

OPOKU-AHWENEEH DANQUAH: Exploration activities in the Volta Basin represent a unique opportunity for Ghana to benefit from new hydrocarbons resources. The aim of this project is to establish a working petroleum system within the basin to increase the country’s hydrocarbons reserves, boost dedicated capacity to support onshore upstream oil and gas development, and increase production over the long term.

Geological outcrop mapping across parts of the northern Volta Basin has been ongoing since 2018 to assess the elemental factors underlying the area’s geological system. High-quality 2D seismic data about the basin has been generated, and GNPC plans to utilise this gathered information to drill an exploratory well by the end of 2024.

Given the initial high-risk, competitive and capital-intensive nature of the upstream oil and gas segment, there are certain operations for which local companies may not currently have the financial resources or technical expertise. However, there are opportunities on offer for domestic entities, including supplying drilling materials and labour; establishing fabrication centres; expanding transport infrastructure; acquiring onshore blocks; and providing catering and accommodation services. This stands not only to enrich the local economy, but also to promote community engagement and specialised capacity building.

What is your assessment of foreign direct investment (FDI) in the country’s oil and gas sector?

DANQUAH: In the two decades preceding 2003 total investment in Ghana’s upstream oil and gas industry was less than $500m. Between 2003 and the first half of 2023, $29.7bn was invested in the sector. This substantial growth in capital expenditure can be attributed to the significant injection of FDI, which accounted for 86.2% of total investment in the two decades preceding 2023. About half of the sector’s FDI has been infused since 2018, therefore such funding continues to be the cornerstone of oil and gas investment in Ghana.

In what ways does GNPC use its status in petroleum agreements to boost local capacity?

DANQUAH: Enhancing local capacity is key to the success of the country’s future oil and gas operations. GNPC monitors and evaluates the implementation of local content regulations to ensure compliance by all partners. The local content plans of joint ventures and GNPC’s standalone initiatives are regularly assessed to ensure that they conform with regulations. This comprehensive review forms a critical component of GNPC’s local content policy currently being implemented.

The strategy outlined within the policy aims to increase local capacity to keep value in country. In 2017 GNPC commenced the acquisition of seismic data on the Volta Basin, with 5% of the technical team comprising Ghanaians; now locals account for more than 85% of the project team. Such interventions are expected to help achieve the targets set for manpower development and expertise in Ghana.

Which upcoming projects are expected to boost upstream oil and gas activities in Ghana?

DANQUAH: The Pecan deepwater field located in the Tano Basin is the next such initiative that is expected to enter the development phase, as the Ministry of Energy approved a plan for it in June 2023. The project is awaiting a final investment decision before commencing field development activities, with the decision expected to come in 2024. Ghana’s Pecan Energies, in partnership with GNPC and Lukoil operate the field, which is projected to start commercial production in the year 2027.