Energy think tank, Africa Centre for Energy Policy (ACEP) has raised concerns about a possible underhand dealing following revelations that Ghana's 7% increased stake in the Jubilee Fields, bought from Oxy for $200 million, has been housed in an offshore company in the Cayman Islands, a tax haven.
Being a tax haven, Cayman Islands is refusing to disclose shareholder information of the company, Jubilee Oil Holdings, hence ACEP says it is unable to confirm whether Ghana Government owns the company 100%.
Meanwhile, ACEP is also alleging that Ghana National Petroleum Commission’s CEO, K.K Sarpong and Board Chairman, Freddie Blay, are directors of the company registered in the Cayman Islands.
ACEP says its checks have revealed that GNPC is seeking to assign interests in some of Ghana oil blocks to the company known as Jubilee Oil Holdings.
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These allegations were levelled by ACEP’s Policy Lead for Petroleum and Conventional Energy, Kodzo Yaotse at a news conference in Accra.
The alleged transaction, Mr Yaotse said, relates to GNPC’s quest to acquire 7% commercial interest in the oil blocs of Ghana.
GNPC in 2021 announced moves to acquire the said interest, adding that it will be transferred to GNPC’s subsidiary, the GNPC Exploration and Production Company (GNPC Explorco).
“Jubilee Oil Holdings is registered in the Cayman Islands with Kofi Koduah Sarpong and Freddie Blay as directors,” he said.
He noted that “ACEP’s search has not yet ascertained the beneficial owners of Jubilee Oil Holdings but the representation of Dr. Sarpong, GNPC CEO and Freddie Blay, GNPC Board Chair in the general registry of Cayman Islands is not enough proof that GNPC is the owner of Jubilee Oil Holdings.
“However, in the absence of evidence of shareholders of Jubilee Oil Holdings we [ACEP] proceed with the assumption that GNPC owns the company.
“While the corporation has not provided public information on the strategic essence of this approach, the unofficial explanation received by ACEP indicates that the corporation intends to use the off-shore company to pay off the loans for the acquisition before the interest reverts to Explorco.”
ACEP is further questioning how some $199 million GNPC needs to finance the acquisition will be obtained.
“In the absence of official information on the financing options from GNPC, speculations are rife. In October 2021, Africa Intelligence reported that GRA, by extension the Finance Ministry, intends to lend the tax settlement amount from the Oxy transaction to GNPC to offset the acquisition cost of the 7% interest with no recourse to the Petroleum Revenue Management Act (PRMA), Act 815 as amended.”
Kodzo Yaotse further indicated that ACEP is in support of an acquisition of the 7% interest in the Jubilee and the TEN fields, however, “the right processes must be followed in respect of Ghanaian laws and proper corporate governance practices that project GNPC among its peers on accountability benchmarks.
“How the corporation has become broke from a strong cash position in the early years of oil production is a major subject for government attention…the corporation must find ways to fit into a philosophy that will advance the overall national interest rather than an attempt to evade the dictates of the Petroleum Revenue Management Act (PRMA) with convoluted schemes such as the new efforts to relocate asserts in Ghana to the Cayman Islands,” he added.