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June 28, 2021

Eni ordered to place 30% revenue from Ghanian field in escrow account

The order is aimed at protecting the local firm Springfield’s interests while allowing operations at the Sankofa field.

By Archana Rani

A commercial court in Ghana has ruled that 30% of revenues from the Eni-operated Sankofa offshore field be placed in an escrow account.

The order comes in response to the request by the local firm Springfield, which operates the Afina oilfield located adjacent to Sankofa field.

Springfield had sought to preserve revenue from the Sankofa field until a deal with Eni is reached to combine the two neighbouring oil fields, as ordered by the government.

In 2020, Ghana’s energy ministry directed the two firms to unitise the Sankofa field, a part of Eni’s Offshore Cape Three Points project, and the Afina field situated in Springfield E&P’s West Cape Three Points Block 2, after discovering that Cenomanian reservoir straddles the two blocks.

The unitisation plan is expected to boost oil and gas production and reduce costs.

Commenting on the ruling, the court said the decision to place approximately $40m per month in escrow would protect Springfield’s interests while allowing operations at the Sankofa field.

Eni was reported by Reuters as saying that that firm intends to review the ruling to assess its potential operational impact.

The company stated: “We fully expect to take the appropriate steps necessary in order to protect our operations in the country, including appealing against this ruling.”

Located about 60km off the coast of western Ghana, the Offshore Cape Three Points block is estimated to hold reserves of about 40 billion cubic metres of non-associated gas and 500 million barrels of oil.

Springfield operates the West Cape Three Points Block 2 with an 84% stake. Ghana National Oil Company, GNPC and its Exploration Unit, EXPLORCO jointly own the remaining 16% interest.

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