Three oil blocs in Ghana’s Western Basin will be up for competitive bidding tomorrow, the Deputy Minister of Energy, Dr. Mohammed Amin Adam has disclosed.
The blocs, which forms part of nine oil blocs earmarked for bidding to prospective oil exploration companies is expected to ensure Ghana’s interest is best served when it comes to conducting business in nation’s upstream petroleum sector.
“In the past, contracts have been awarded to people who turned out not to have the requisite capacity to prospect and drill. The bidding on Friday will ensure that the blocs are given to companies with proven track record who can comply with requirements of the contract.
We want to attract the right calibre of people into our oil sector to fast-track oil activities, ensure transparency, be able to make more discoveries that are economically viable, increase and sustain production,” the Deputy Minister said in an interview with the Ghanaian Times yesterday.
It was on the sidelines of a forum to discuss emerging issues in Ghana’s implementation of local content policies, comparing and drawing lessons from key sectors in some African countries.
The forum organised by policy think-tank, IMANI in collaboration with BUSAC Fund, brought together representatives from government agencies, private sector, diplomats, academia and civil society organisations.
The Deputy Minister indicated that inasmuch as the bidding was opened to all interested investors, a key requirement for winning an oil contract would be a bidder’s ability to have local representation.
“Foreigners and locals alike are invited to bid on their own right but if you are a foreign company, you must have a local partner because that is one of the measures we will use to determine the winner of the contract. We will take into consideration the percentages you give to the partner among others conditions to award of a bloc,” he said.
Dr. Amin Adam further submitted that a window for direct negotiations with any investor interested in exploration activities would also be opened, however, “if you express interest in a bloc, we will not start negotiations until after 30 days and if within it, another company shows interest, then, it will be opened for competition”.
Addressing the forum, the deputy minister reiterated the need for increased capacity building of locals in the oil and gas sector to be able to work within international best practices.
He urged investors to “study and be interested in training and building the skills and abilities of Ghanaians to work within the industry” as that would be cost effective in their business operations compared to “recruiting experts whom you would have to cater for their upkeep and that of their family”.
The Minister for Works and Housing, Samuel Atta Akyea, called for “complete overhaul” of the country’s laws on local content so as to have a “mother document to guide the implementation of local content across all sectors”.
He, however, cautioned that the quest for local content must not be an avenue to encourage mediocrity saying, “Where the Ghanaian has the requisite capacity to undertake a project, he must be considered over a foreigner but when he lacks it, in order to prevent a shoddy work done, we must encourage him to understudy the experts while we employ someone who can deliver.”
Mr. Atta Akyea again proposed a budgetary allocation to focus on training and building capacity of locals to stand up to international practices.
A Research Associate, Centre for Energy and Natural Resource, IMANI, Barbara Andoh presenting a report on Ghana’s readiness for more local content recommended that a comprehensive framework to track year-on-year achievement of local content targets was developed.
“It is important that local content application is guided by a long-term development strategy and in line with tracking local content improvements, it is needful that government bolsters monitoring of both local and foreign investors to ensure absolute compliance and attain desired outcomes,” she urged.