Tullow begins Tweneboah-Enyera-Ntoumme Project

The development of the Tweneboah-Enyera-Ntoumme (TEN) Project off the shores of the Western coast of the country has started, with the cost estimated at US$4.9 billion.

The development involves the drilling and completion of about 24 wells, which will then be interconnected, through sub-sea infrastructure, to a Floating, Production, Storage and Offloading (FPSO) vessel.

The process is expected to run from now till 2016 when the operator, Tullow Ghana, will commence commercial production of oil on the field.

A Senior Executive Director of the Tullow Group, Mr Mark Macfarlane, disclosed this in an interview after the company had taken its turn at the Ghana Stock Exchange’s ‘Facts Behind the Figures’ programme in Accra.

The programme is an initiative of the local bourse aimed at giving listed companies the opportunity to explain their individual financial performance to the general public, especially stock brokers and analysts, as well as the media.

The TEN Project is about 25 kilometres off the Jubilee Field and Tullow, which is the operator, holds about 50 per cent interest in it, leaving the rest to Anadarko and Kosmos with 18 per cent each and the Ghana National Petroleum Corporation (GNPC) and Sabre oil and Gas  with 10 and 4.05 per centrespectively.

The cost of the development is to be treated as recoverable cost – costs that will be recovered after the start of oil production – and will be funded by contributions from the various partners.

The contributions are to be done based on the amount of stakes held by each of the partners.

Selling TEN stake

The TEN Project is estimated to produce some 80,000 barrels of oil per day (bopd) when production starts in about two years and will add to the one from the Jubilee Field.

Tullow Ghana, which has about 36.4 per cent stake in the Jubilee Field, has started a process to sell some of its interest in the TEN Project, explaining that its current share of about 50 per cent exposed it to many risks and costs associated with the oil business.

“We want to reduce the level of exposure and our capital investment in the project,” the group’s Investor Relations and Communications Manager, Mr Chris Perry, said at the event.

It is, however, not clear how much the company is willing to retain but its Senior Executive Director said it was likely it would retain “more than 30 per cent.

GNPC yet to decide

The Director of Operations at the GNPC, Mr Thomas Manu, said in an interview that the corporation was yet to decide on whether or not it should express interest for Tullow’s stake.

“We will evaluate the terms of the sale and make a decision,” he said, explaining that such a decision will only be taken after the corporation’s board had deliberated on the matter.

Although Tullow’s Senior Executive Director said the company did not mind selling its stake to GNPC, should the corporation meet the terms of the purchase, sources closer to the transaction said that was not likely to happen given the latter’s financial challenges.

“Already, it is difficult for them to raise funds for the Jubilee Field. Whenever it comes to contributions, they always make the others pay upfront and selling them this stake will also mean that they will be doing same,” the source added.

By Maxwell Adombila Akalaare & Emmanuel Bruce/Daily Graphic/Ghana