Ghana has lofty expectations for its oil reserves, expecting production to more than double by 2021 to 250,000 barrels per day (bpd).
It was only three years ago that Ghana, West Africa’s second-largest economy, first joined the ranks of the world’s oil producers. In that time, the nation has discovered that it holds quite a bit more oil than it ever anticipated.
Now Ghana is set to develop its fields and start pumping out oil with the big guns.
Well, maybe more like medium-sized guns. Still, Ghana is taking steps to prove that it belongs in the ranks with other major oil producers.
The latest discovery is being called the TEN, or the Tweneboa-Enyenra-Ntomme, a cluster of oil fields that are set to begin development this year. It is estimated that the site may hold reserves as large as 245 million barrels and provide a peak production of 76,000 bpd, according to Bloomberg.
The TEN also will likely produce 50 million cubic feet of gas during peak production. It is slated to produce its first oil sometime in 2016.
Ghana Oil Fields
There are various reserves in different stages of appraisal and development in Ghana; while gas discovery is complete, oil—which runs vast throughout the region—is still ongoing.
Ghana’s total projected production plateaus won’t be revealed until this process is finished.
That leaves a lot of work to be done. State owned Ghana National Petroleum Corporation (GNPC) will be spending upwards of $20 billion in the next five to eight years to develop its national oil reserves.
It has already invested $30 million in preparations to position itself for exploration and production moving into the future.
A lot of those state funds will go to the Jubilee field—the formation that kicked off Ghana oil when it was discovered in 2007 and produced its first barrel in December of 2010. Not only is it Ghana’s largest oil field—proven reserves are right around 600 million barrels—but its production value continues to increase.
Its average daily output has been 110,000 bpd over the last three months, and as NYDailyNews reports, this is a 40,000 bpd increase over its average for 2012.
The Jubilee, located offshore between Ghana’s Deepwater Tano and West Cape Three Points basin, was first developed by Tullow Oil Plc (LON:TLW), and the company still operates in Ghana’s lone crude-exporting oil field.
GNPC is also exploring Ghana’s Voltaian Basin, which stretches from the south to the northern part of the country and covers about 40 percent of its total mass.
Currently, GNPC has made seven additional discoveries in the Tano Cape Three Points Block, operated by Hess (NYSE:HES). This block is close to where the Jubilee field is located, and appraisal of these discoveries should take place sometime this year.
Booming Oil Exports
This latest proven discovery (TEN), along with others that are all still in developmental stages, has made oil very appealing in Ghana, and very lucrative as well. As production begins to surge ahead, a tremendous amount of capital will penetrate Ghana’s borders, job growth will increase, and the economy will flourish as a whole.
Presently there are 10 active agreements with companies across the country’s three coastal basins, including Tullow, Kosmos Energy (NYSE:KOS), and Lukoil (OTC:LUKOY).
The Sankofa and Gye Nyame fields, also in the Three Points basin, will be developed in 2016 or 2017, and they will be operated by Italian oil and gas company Eni SpA (NYSE:E).
Last year, oil became the country’s second greatest export, displacing cocoa with its shipped value of $3 billion. Gold is still the nation's primary earner, but with so much oil being tapped in the near future, it is clear oil will continue to play a major role.
The Ivory Coast, which neighbors Ghana and has been in great turmoil in recent history, has also recognized its own potential for oil. Just two years ago, it found itself emerged in civil war, and oil production fell off by nearly half.
But now it, too, has great expectations for production, hoping for 200,000 bpd within five years, up from the 32,000 bpd it currently produces.
Since the end of its civil war, the Ivory Coast has reached fourteen new production agreements with oil giants like Total (NYSE:TOT) and Anadarko (NYSE:APC), among others.
Oil production definitely has a promising future in Ghana and other West Africa nations, and it will most certainly leave its impression on the oil industry.
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