Ghana has seen several major oil and gas discoveries over the last few years and will experience significant growth in production as these fields are developed and come on line.
Investopedia Broker Guides: Enhance your trading with the tools from today's top online brokers.
Ghana is currently an insignificant part of the global oil and gas market, with reported production of approximately 8,880 barrels of oil per day in 2010 and proved oil reserves of 660 million barrels at the end of 2011. The government estimates that recent discoveries in Ghana may boost proved oil reserves to five billion barrels by 2015.
The Jubilee Field is located on the Deepwater Tano and West Cape Three Points blocks offshore Ghana and is regarded as one of the largest oil and gas finds in Africa in recent years. Oil was first discovered at the field in 2007 with the drilling of the Mahogany-1 well.
After several successful follow-up discoveries, phase one development began and the Jubilee Field started up production in late 2010. The field will have a productive capacity of 120,000 barrels of oil per day via a floating production, storage and offloading unit. The Jubilee Field is estimated to hold between 600 million and one billion barrels of gross recoverable oil resources.
There are many operators involved with the development of the Jubilee Field. Tullow Oil (OTC:TUWOY) plans to commence Phase 1A development of the field, which will involve drilling eight additional wells at a cost of around $1.1 billion. The company expects net oil production from Ghana to average 28,000 barrels per day in 2012.
Kosmos Energy (NYSE:KOS) owns 30.875% of the West Cape Three Points license and 18% of the Deepwater Tano license. Anadarko Petroleum (NYSE:APC) is also involved with the Jubilee Field and owns an 18% interest in the Deepwater Tano license and a 30.785% share of the West Cape Three Points license.
SEE: A Primer On Offshore Drilling
Hess Corporation (NYSE:HES) is active in offshore Ghana and reported the success of the Paradise exploration well in May 2011. The company is currently drilling the Hickory North prospect and expects results from this exploration well in the second quarter of 2012. Statoil (NYSE:STO) owns a 35% interest in this license area.
Eni (NYSE:E) reported a successful exploration well at the Gye Nyame offshore field in July 2011. The well was drilled to a depth of approximately 11,000 feet and encountered natural gas and condensate pay.
The Gye Nyame well was located close to the Sankofa discovery, a previous exploration well drilled by Eni in 2009 that also found oil and natural gas resources. The company has since drilled a successful appraisal well at the Sankofa Field.
The Bottom Line
Ghana is a small player in world oil markets but will soon have a much higher profile as oil and gas production ramps up with the planned development of a number of offshore fields.
At the time of writing, Eric Fox did not own shares in any of the companies mentioned in this article.