Springfield’s involvement in WCTP 2 represent significant indigenous investments
The Government’s decision to lead discussions that could result in the acquisition of Springfield Exploration and Production Limited’s (SEP) interest in the West Cape Three Points Block 2 (WCTP 2) has generated widespread debate across the energy sector and the broader public space.
While some of the commentary may be well-meaning, a significant portion reflects a misunderstanding of the realities surrounding Springfield’s investment journey and the bold initiative of the only Ghanaian to successfully invest in Ghana’s upstream.
Springfield’s involvement in WCTP 2 represents one of the most significant indigenous investments in Ghana’s upstream petroleum sector. Of the four Upstream operators in the country namely Tullow Ghana Limited, Eni Ghana E&P, Aker/Pecan Energies and Springfield, the latter is the only indigenous company trailblazing for the future entry of other home-grown upstream players.
When Springfield first bid for the relinquished block in 2012, many doubted that a Ghanaian company could make any tangible impact in such a capital-intensive and technically complex industry, particularly so, when the company’s founder was at the young age of 32years.
The Founder and CEO, Kevin Okyere continued the process of application for the oil block in 2014 and was not successful until the age of 36 years. Through persistence, strategic planning and substantial financial investment, Springfield was awarded the block which was subsequently ratified by Parliament in 2016.
Although acquiring seismic data on the Block was not part of its initial programme, Springfield, within a year of securing the block, contracted the world’s largest seismic vessel, the Ramform Titan owned by Petroleum Geo-Service (PGS) to undertake a 3-D seismic data on the entire 673 square kilometres at the cost of $9,317,000 in April 2017. This was done to enhance the value of both the existing and new data.
The data gathered would form the basis for the Afina-1x drilling campaign, which led to the discovery of hydrocarbons in commercial quantities. This milestone discovery increased the volume of oil in place to more than 1.5 billion barrels and an estimated 1.2 trillion cubic feet of gas.
It is envisaged that the discovered fields together would produce approximately 80,000 stb/day at peak rates and approximately 250mmscf (200mmscf for non-associated gas and 50mmscf for associated gas).
Of even more significance is the fact that the discovery was made in Cenomanian and Turonian depths in Deepwater, a feat never chalked by any indigenous upstream company in Africa. All these operations were conducted on time, within budget and without any safety incidents, which speaks volumes about the company’s technical and safety excellence as an indigenous Operator.
It is worthy to note that these numbers have been confirmed by leading independent petroleum consulting firms in the United States of America and the United Kingdom that work for companies that file reports with the US Securities and Exchange Commission amongst others.
All this later became the subject of a legal dispute with Italian oil major ENI, complicating the path to development.
Following an arbitral ruling, the Petroleum Commission directed Springfield to appraise the Afina discovery, in accordance with its Petroleum Agreement obligations. In an unprecedented record time of three months, Kevin Okyere rallied his team, mobilised resources and contracted service providers to execute the Afina appraisal campaign.
The appraisal yielded very positive results which led to Springfield notifying the Minister and the Petroleum Commission that the discovery is commercial. It also confirmed that the Afina Discovery is in communication with the Sankofa field, thereby making a strong case for unitisation.
It is important to recognise that all these activities, from seismic surveys, drilling campaigns, compliance with regulatory directives and recurrent operational expenditure estimated at US$280 million has been funded by Mr. Kevin Okyere and his Partners.
The element of thousands of job created from the time the Block was awarded through direct employment, contracts and sub-contracts awarded to service providers internationally and locally cannot be lost on any objective observer.
The goal, as Kevin Okyere frequently puts it in his interviews, is for the assets to be produced for the benefit of the Ghanaian and Africans.
The discussion with government is therefore to explore options to raise fresh capital for further developmental and appraisal activities to continue. These discussions include bringing in new partners into the block or GNPC-Explorco who currently hold 5% to acquire more stakes from Springfield.
Such an approach offers the dual benefit of strengthening the technical and operational capacity GNPC’s Exploration company while also accelerating the development and production of WCTP 2 resources for the benefit of the Ghanaian economy.
The WCTP 2 currently has proven hydrocarbon reserves so the Government-led discussions must be viewed through the lens of strategic national interest, not misplaced sentiments.
Kevin Okyere’s vision, through Springfield, has demonstrated that indigenous participation in Ghana’s most strategic sector is not only possible but impactful.
If Ghana is truly committed to nurturing local champions in critical industries, then Springfield’s investment in WCTP 2 must be recognised not as a liability, but as a national asset deserving of fair and strategic consideration.
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