Tullow Oil Plc has said it will soon engage the government for a new oil block after missing out on a recent bidding contest for new oil fields.
According to Tullow Oil, the move is part moves to consolidate its operations in the country after several years of exploring oil in Ghana.
Speaking to Joy Business after the company took its turn at the Ghana Stock Exchange’s ‘Facts Behind The Figures Session,’ Chief Finance Officer of Tullow Oil PLC, Less Wood, noted that the oil firm will be looking forward to government’s desire to open its doors for another negotiation for new oil blocks on the country’s new oil fields.
He told Joy Business Tullow Oil has learnt its lessons after missing out on the first round of bidding process and would ensure that this time around they get it right.
On reasons why they missed out on the first round licensing process, Mr Wood noted that “I think we put a fair bid on the table, but it was just unfortunate that we were beaten.”
He also noted that securing a new block will be strategic as an oil exploration firm.
“We believe that getting another block would help strengthen our mission here in Ghana because we want to demonstrate that we are here for good,” he explained.
Ghana’s bidding round process and Tullow
The government in July 2019 announced winners for its two oil blocks after evaluating the bids in Ghana’s first licensing rounds
According to the Ministry, “First Exploration and Petroleum Development Company Limited in partnership with Elandel Energy (Ghana) Limited emerged winners of block GH_WB_02. Eni Ghana Exploration and Production Limited in partnership with Vitol Upstream Tano Limited emerged winners of block GH_WB_03.”
A total of 60 applications were initially received, but two were invalidated as they were for a block reserved for Ghana National Petroleum Corporation. ExxonMobil and British Petroleum (BP) earlier pulled out from the bidding process. The two International Oil Companies (IOCs) had earlier submitted applications for direct negotiations for block 5 and 6 but had to pull out at the last minute.
It is not clear yet why the two multinational companies decided to pull out at the last minute.
Ending Turret Bearing work on the Jubilee Oil Field
Less Wood also disclosed to Joy Business that Tullow Oil ended work on its turret bearing which resulted in serious shutdowns of oil production on the Jubilee Oil field.
The shutdown over the past years resulted in the shutdown of oil production. In some instances, production was haltered for two weeks because of the shutdown.
The development then affected the supply of natural gas from the Jubilee Oil Field which was used as fuel for power production in the country.
Mr Wood told Joy Business that even though there would be shutdowns, that would be done as part of its normal routine maintenance on the vessel and not for corrective works on Jubilee Turret Bearing.
“There would be usual annual shutdown but that would be related maintenance work,” he added.
“Ending this turret bearing works should also come as a big relief to us in terms of its positive impact on our operations and revenue,” Less Wood added.
Tullow’s share price in Ghana
The Chief Finance Officer of Tullow Oil Plc also revealed that the oil firm was taking steps to improve on its fortunes.
Less Wood believes this would go a long way to affect its share price on London and Ghana Stock Exchange (GSE).
The share price of Tullow Oil is currently trading on the local bourse at GHS11.49.
Less Wood is of the view that globally, oil and gas shares have not been doing that well because of current development on the international market. But was, however, optimistic that things should be turning around soon.
“Our job is to deliver and we believe that the shareholders should be excited by that,” Mr Wood added.