Minority raises red flag over $7 billion judgment debt

John Abdulai Jinapor, Member of Parliament for Yapei-Kusawgu and Ranking Member of the Mines and Energy Committee has disclosed that Ghana faces a $7 billion judgment debt under President Nana Addo Dankwa Akufo-Addo.

In a statement, the Minority in Parliament has noted with grave concern, the protracted impasse between ENI/Vitol and Springfield Ghana, which was occasioned by a directive by then Minister of Energy, John Peter Amewu, instructing the two parties to execute a Unitisation and Unit Operating Agreement (UUOA) at the Sankofa and Afina fields.

ENI/Vitol has since challenged the decision of the Minister insisting that the decision was premature and did not meet industry standards leading to a stalemate in the implementation of the directive.

It said: "We note that the current impasse has also led to a bitter legal dispute resulting in a Ghanaian court order directing ENI/Vitol to deposit 30% of its monthly revenue into an escrow account pending unitisation."

John Jinapor Pulse Ghana

"We are also aware that ENI/Vitol has commenced legal action in the International Court of Arbitration seeking damages of about $7 billion against the Government of Ghana."

Legal dispute

On June 25, 2021, the High Court ruled in favour of an application by Springfield Exploration and Production (SEP) – operator of the West Cape Three Points oilfield (WCTP) Block 2 – to freeze 30 percent of revenues received by ENI and Vitol from the sale of crude oil from the Sankofa field.

The payment, which is estimated to be about US$40million monthly, was expected to start from June 25, 2021 (the date of the original ruling) and continue every month afterward until the substantive matter is determined and was expected to be paid into an account to be agreed by the parties, but subsequently, SEP reached out to ENI on several occasions to try and get the parties to nominate a bank account for the payment.

The Supreme Court said ENI and its partner never responded to the request from SEP.

On January 24, 2022, the High Court made an order for the two parties not to agree on an account but rather to pay the money to the court registrar to be paid into an escrow account – this order is what ENI and Vitol sought to quash – an application which was dismissed by the Supreme Court.

The companies have been in dispute since an April 2020 directive was issued by the Ministry of Energy to unitize the Afina and Sankofa fields to ensure optimal recovery of the resources in the common reservoir in the interest of all the parties involved, including the State.