Business News of Monday, 22 October 2018
ExxonMobil may get an extension of the timeline to select a local partner for its operations in Ghana.
Citi Business News understands this may be the option since the government is keen on getting the company to operate in the country’s oil sector.
Deputy Energy Minister, Dr. Mohammed Amin Adam disclosed this in an interview on the progress of work for the international oil company.
After signing the agreement with the government of Ghana in January this year, ExxonMobil was given two hundred and seventy days; equivalent to nine months, to select a local partner.
This is in fulfillment of the government’s quest to implement the local content policy in the petroleum laws.
Dr. Mohammed Amin Adam explained to Citi Business News for now, the timeline still holds.
“We gave them up to the end of October and then once they get to that stage, the government will be very reasonable with them. Because they are doing due diligence and this is a very difficult process of selecting one out of so many companies in Ghana and they are also considering the financial capabilities of the companies,”
But with only eleven days to the end of October, concerns are being raised on the ability of the company to attract a local partner for its operations.
However, Dr. Amin Adam describes the task as a tough one but says the government may step in and possibly extend the timeline to get the needed partner.
“If they are not able to find one and they are still interested in pursuing their investment interest in Ghana, given the caliber of company it is, Ghana is interested in partnering with them. If we may have to extend the timeline for them to finally get one, we will do that because it is in our interest as a country to have ExxonMobil in our oil and gas industry,” he observed.
Parliament is expected to ratify the agreement once a local partner is selected.
Ghanaian ownership in ExxonMobil is estimated at thirty percent.
This comprises ten percent royalty to the government of Ghana, fifteen percent for GNPC in Carried and Participation Interest while the local partner will have 5 percent stake.