Aker Energy to take over Hess block offshore Ghana
- Business & Finance
Aker Energy has entered into an agreement with a subsidiary of Hess Corporation to acquire its interests in Ghana consisting of a 50 percent participating interest in the Deepwater Tano Cape Three Points block (DWT/CTP).
Aker Energy is a a 50-50 joint venture between Aker ASA and TRG AS. Deepwater Tano Cape Three Points blocks is located 70 miles offshore Ghana in the Gulf of Guinea.
The Tano Basin offshore Ghana is a prolific petroleum region where Aker Energy sees considerable potential to apply the Aker Group’s experience from the Norwegian Continental Shelf (NCS) to build a significant E&P activity in Ghana together with Ghana National Petroleum Corporation (GNPC), Aker Energy said on Monday.
The total cash consideration for the transaction is $100 million, consisting of $25 million payable upon closing of the transaction and a further $75 million payable upon approval of the Plan for Development and Operation (PDO) on the DWT/CTP block.
The acquisition is subject to approval from relevant Ghanaian authorities and other customary closing conditions.
The DWT/CTP block covers approximately 2,010 square kilometers in a prolific petroleum region. In the last ten years, seven exploration wells and five appraisal wells have been drilled on this block. The discovered contingent resources are estimated to be 550 million barrels (2C) with a remaining prospective volume upside of approximately 400 million barrels.
Aker Energy said it has drawn upon the expertise in oil field development from the companies in the Aker Group and is currently progressing a commercially robust development solution with a fast-track first phase targeting approximately 400 million barrels.
The field development concept will be based on an FPSO with a subsea production system. The development concept will build on experience gained from the NCS with multilateral wells with improved completion solutions providing improved reservoir contact and recovery factor. Proven artificial lift solutions will further enhance recovery rates while infield pipeline solutions will ensure flow properties. The subsea production system will be designed to facilitate rapid tie-backs to the centrally located FPSO in the second phase.
The PDO will be submitted in 2018 with anticipated first oil in 2021.
Øyvind Eriksen, President & CEO of Aker, said: “Aker is pleased to have been invited into this joint venture by TRG and looks forward to exploring the opportunity of building a significant E&P activity in Ghana inspired by what Aker has achieved on the NCS.”
Dr. K.K. Sarpong, CEO of GNPC said: “We believe that our collaboration will lead to further successes in the ultra deepwater Tano basin of Ghana, and enable the transfer of knowledge to the Ghanaian oil and gas industry.”
Aker Energy noted it plans to build an independent organization to manage the planned exploration and appraisal programs as well as the ongoing field development work. More than 60 people are currently engaged in the project for Aker Energy. During a transition period, Aker Energy will draw on certain key third-party capabilities, including from Aker related companies. Aker BP will deliver limited services to Aker Energy on market terms and remain separate without funding commitments or ownership interests in Aker Energy, or any Ghana related activities.
TRG, a company owned by Kjell Inge Røkke and the principal shareholder of Aker, has been involved in Ghana since 2014 and holds an interest in the South Deepwater Tano block (SDWT) through its investment in Petrica Holding.
The SDWT block is located immediately to the south of the DWT/CTP block and measures approximately 3,500 square kilometers. The block contains several high potential exploration prospects.
New high resolution seismic is currently being acquired in the SDWT block in preparation for exploration drilling. Aker Energy envisages significant synergies between the DWT/CTP and SDWT blocks and will target a regional development.