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Ghana, oil companies face off over control of rich field

- The Washington Times - Thursday, July 8, 2010

An ongoing dispute between the government of Ghana and representatives of Kosmos Energy over control of the oil-rich Jubilee field shows signs of coming to a head.

Ghanaian officials are scheduled to meet Tuesday in Accra, Ghana, with representatives of Kosmos and ExxonMobil to try to resolve the oil companies' months-old rift with the government over the vast newly discovered oil field in the waters off the country's coast, according to the Ghanaian embassy.

"Ambassador Ohene Agyekum would be meeting with the Ghanaian authorities, Exxon Mobil and Kosmos on 13th July in Accra on some of the issues raised," a Ghana embassy official told the Washington Times in an e-mail response to the paper's request to interview Ambassador Daniel Ohene Agyekum about a number of issues, including the status of the talks and when the problem would be resolved.

Ghana has been trying to block Kosmos' sale of the company's stake in the Jubilee field to ExxonMobil, the world's largest private oil company, for an estimated $4 billion. Government officials have been demanding that it be sold to Ghana's state-run oil company, the Ghana National Petroleum Corp. (GNPC).

A source close to the negotiations also said that Kosmos has asked Ghanaian President John Atta Mills for his government's formal consent on the ExxonMobil deal - a key procedural step that comes months after Kosmos officials in October announced their intentions to sell their stake in the Jubilee field, where up to 1.8 billion barrels' worth of oil is said to be contained.

Some observers have said Ghana has tried to stop the ExxonMobil deal so GNPC can buy the Kosmos stake at a reduced price and resell it to another company at a profit. A number of suitors also have shown an interest in acquiring the stake, including the Korea National Oil Corp. (KNOC), the China National Offshore Oil Corp. (CNOOC), and India's Oil and Natural Gas Corp. (ONGC).

Since taking office in January 2009, critics said, the Atta Mills government repeatedly has sought to interfere with Kosmos' business and has targeted foreign companies that invested heavily in Ghana under the prior administration.

Ghanaian officials maintain that Kosmos violated its contracts and the GNPC has the exclusive right to buy Kosmos' Jubilee stake - all of which Kosmos denies.

Kosmos officials declined to comment, citing the ongoing negotiations. Kosmos has maintained that Ghana has no right to stop the ExxonMobil sale. While its petroleum agreements with Ghana say Kosmos cannot assign its interests without the written consent of the energy minister and the GNPC, the agreements also note that such consent "shall not be unreasonably denied, withheld or delayed."

Oil analysts said such consent generally can be denied only if the buyer company lacks the financial or technical capabilities - which would not apply to ExxonMobil.

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