Kosmos remains uncertain as Ghana, Ivory Coast negotiate offshore boundary

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Nine months before Ghana began commercial production of oil in March 2010, a major challenge to the country’s oil fields was posed by the Ivory Coast.

Ghana’s western neighbour laid claim to the location where oil was discovered on February 26, 2010 by a consortium led by Russian oil giant LUKOIL.

LUKOIL said the discovery was made in the Dzata-1 structure of the Cape Three Points Deep Water Block in the Gulf of Guinea offshore the Republic of Ghana. But the Ivory Coast claimed the location was within its territory.

And Texas-based oil explorer, Kosmos Energy has expressed fears about the development. The oil producer says the future of a portion of its license in the Deepwater Tano Block is uncertain as the issue remains unresolved.

Kosmos fears that if changes are made to the maritime boundary demarcation between Ghana and Ivory Coast, it may lose some of its license to operate.

The Dzata-1 well and the Deepwater Tano fall within the same boundary.

Currently Ghana is the rightful owners of the area, but Ivory Coast has petitioned the United Nations to demarcate the Ivorian territorial maritime boundary with Ghana. Even though the two countries met in April 2010 for negotiations on the matter, Kosmos says the results of the meeting were not announced and the issue remains unresolved at present.

“Uncertainty remains with regard to the outcome of the boundary demarcation between Ghana and Côte d’Ivoire and we do not know if the maritime boundary will change, therefore affecting our rights to explore and develop our discoveries or prospects within such areas”, the Warburg Pincus and Blackstone Group (BX) backed company said in a S-1 filing form to the US Securities and Exchange Commission on April 25, 2011.

Mr. Thomas Manu, Director, Operations of the Ghana National Petroleum Corporation (GNPC) has confirmed to ghanabusinessnews.com that negotiations between the two countries are ongoing and there is no resolution.

The political situation in the Ivory Coast has affected negotiations, contributing to the delay, a government source who asked not to be named has told ghanabusinessnews.com.

Kosmos has 18% stake in the Deepwater Tano block in the Gulf of Guinea.

According to Kosmos, it has drilled 14 wells successfully out of 15 at the Deepwater Tano Block Offshore Ghana.

By Emmanuel K. Dogbevi & Ekow Quandzie

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