Skip to content

File: Kosmos Energy, EO Group and Others

March 3, 2010

This File is a pre-Dossier file consolidating issues relating to Ghana’a oil and the ongoing saga of the sales of Kosmos shares.

The Issue

Kosmos Energy announced the sale of their shares to Exxon Mobil. In response, the Ghana government said that they are not allowed to do that without the GoG’s approval, and that the GNPC is interested in acquiring the Kosmos shares. Subsequently “all hell broke loose” with the commencement of criminal investigations into the Kosmos – EO Group’s activities, and the issue became an International relations issue when Chinese interests in acquiring the Kosmos shares became known.

The recent announcement by Kosmos that it is withholding the sales of their shares and that it will venture into drilling has thrown a whole new perspective on this saga.

Timeline

2010

March

12 – Investopedia reports stock price damage to Exxon Mobil due to Ghana government blocking of Kosmos deal. The same day a columnist posted on Ghanaweb claiming the prosecutions are politically motivated. On the same day it is reported that Kosmos has decided to withhold the sale of their shares and venture into drilling.

01 – Columnist on Peace FM claimed that EO Group  played major role in getting USA companies (Vanco / Kosmos) to risk a lot o explore Ghana’s oil fields

February, 2010

10 – Dow Jones reports that Kosmos Energy LLC is seeking buyers for its stakes in a huge West African oil field,

10 – Ghanaweb announces EO – Kosmos rip-off.

09 Ghana has not blocked a planned $4 billion oilfield stake sale to Exxon Mobil by Kosmos Energy but still threatens to do so if the parties do not abandon the deal. (Reuters via Ghanaweb)

08 – The government of Ghana has blocked the estimated $4 billion sale of a stake in its Jubilee oil field, foiling months of talks between potential buyer Exxon Mobil Corp and the stake’s owner, Kosmos Energy LLC (WSJ).

03 – US oil giant, Anadarko International Oil Company, has blown the whistle on the shape of how oil exploration licenses were awarded under the NPP government.

January, 2010

21 – Tullow Oil PLC said Thursday that an appraisal well drilled on the Tweneboa field offshore Ghana has shown it to be a major oil and gas-condensate field.

06 – Reports that talks between BP and Ghana National Petroleum Corp over a joint offer for Kosmos’s Ghanaian assets broke down in recent weeks.

2009

December, 2009

China Development Bank said it had agreed to lend GNPC money to pay for infrastructure projects in the Jubilee field, without giving details of how much the bank would be prepared to lend.

30 – Decision of the Minister of Energy to abrogate the November 5, 2008 Petroleum Agreement (PA) signed among the Government of Ghana (GoG), Ghana National Petroleum Corporation (GNPC), Aker Asa and Chemu Power Company Limited.

08 – Kosmos Energy said an appraisal well it drilled offshore Ghana found signs of oil and gas.

October, 2009

12 – China National Offshore Oil Corp is in talks with Ghana National Petroleum Corp to bid for a stake in a large oil discovery off West Africa.

12 – State-run Ghana National Petroleum Corp (GNPC) believes Kosmos Energy’s deal to sell its stake in the huge Jubilee oil field to Exxon Mobil is illegal.

12 – Kosmos Energy said Monday it had signed an exclusive deal with Exxon Mobil Corp. to sell its stake in a significant oil discovery off the coast of Ghana.

12 – The Ghanaian government is divided over whether to cut a deal with a leading Chinese oil company or with Exxon Mobil Corp. to develop a giant offshore oil field (WSJ)

08 State-run Ghana National Petroleum Corp (GNPC) is still interested in buying Kosmos Energy’s stake in the giant Jubilee oil field.

06 – A wired news report attributed to an unnamed source and authored by James Herron of Dow Jones Newswires alleged that a U.S. oil giant ExxonMobil Corp. has bought Kosmos Energy’s stake in oil blocks offshore Ghana.

June, 2009

15 – Meeting held in Washington on June 15, 2009, had told a Ghanaian government team led by the Attorney-General and Minister of Justice, Mrs. Betty Mould-Iddrisu that their $2.5m investigations had found no “smoking gun” pointing to any criminality and illegality on the part of Kosmos and its local partners, the EO Group in connection with their acquisition of exploration and production rights in the West Cape Three Points Block in July 2004.

May, 2009

12 – Tullow’s Chief Executive Officer Aidan Heavey is reported to have confirmed in an interview  that the partners in Jubilee have “legal rights to preempt” any deal for Kosmos’ stake. (It is this right that the Government of Ghana appears to be exercising.)

2008

November, 2008

5 – Petroleum Agreement (PA) signed among the Government of Ghana (GoG), Ghana National Petroleum Corporation (GNPC), Aker Asa and Chemu Power Company Limited.

2004

July, 2004

Kosmos and its local partners, the EO Group acquires exploration and production rights in the West Cape Three Points Block.

Links

Kosmos Energy Website

Subject A:  USA v Ghana

Official ThuggeryBy writing to Exxon Mobil that the GoG will “support the strategic intent and efforts of GNPC to acquire Kosmos’s Ghana assets at a fair market value” the GoG practices “official thuggery” in that it scared off investors in the hope of picking up Kosmos Energy’s shares at a well below market value.

Contravening Ghana LawUnder Ghana law, consent for a deal such as the one between Kosmos and Exxon can’t be unreasonably withheld, delayed or denied. That is exactly what Ghana did.

Unlawfully Repudiating ContractsThough the agreement for offshore exploration with Norwegian Aker had been unanimously approved by Ghana’s parliament, the government just turned around and said that the license was invalid.

Biting the hand that feeds it The “manipulation” by Ghana to try and force Kosos to sell to the Chinese is a slap in the face of American taxpayers after they have contributed US$ millions towards Ghana’s development in the form of the Millennium Challenge fund.

Destroying hard-earned relationships – The acts by the Ghana government has the potential to haunt relations for years to come.

Acting in bad faith – If it was not for Kosmos Energy’s high risk venture to explore the deep water oil fields of Ghana, Ghana might today not even have made these discoveries. By trying to swing the deal towards the “scavaging” Chinese is an act of bad faith.

Subject B: Ghana v EO Group

The case against the EO Group is based on:

Causing financial loss to the state –Very little facts on this allegation have been made known.

Fraudulent actions in setting up the company – Various examples of documentation that was signed “fraudulently” is mentioned.

Contravening exchange regulations – Two cases ($145,000 and $10,000) are noted.

Contravening company law – Neglect to hold an AGM and to submit financial statements.

Contravening GIPC regulations – Neglect to pay the required $10,000.

Subject C: Others v Ghana

Various allegations have been made against the actions of the Government of Ghana in the Kosmos – EO Saga:

Witch hunt – The persecution of the EO Group is based on the fact that the Directors are close friends / allies of former President Kufuor.

Diversionary tactics – Despite the fact that the PA between the GoG was ratified by Parliament in 2004 with full knowledge of the stake of the EO Group, the latest actions by the GoG is purely diversionary tactics to further their goal of acquiring a “better deal” with the new owners of the Kosmos shares.


Advertisements
No comments yet

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: