June 30, 2021

Springfield confident final court ruling will see to effective development of oil field

One of the key actors in the ongoing ENI-Springfield unitization saga, Springfield Exploration and Production Limited, says it is confident the final court ruling in the case involving the two parties will lead to the development of the Sankofa and Afina fields in a manner consistent with world-class practices.

This comes after the recent ruling by the Commercial Division of the High Court in Accra on Friday, June 25, 2021, ordering that, 30% of all revenues accruing to ENI and Vitol from exploration and production activities from the Sankofa field be preserved in an interest-bearing account until the substantive case is determined.

The substantive case involves Springfield praying the high court to compel ENI to comply with the directive of then Energy Minister John Peter Amewu for unitization.

Speaking to Citi Business News, on the way forward, Corporate Affairs Manager of Springfield, Kennedy Noonoo said he was confident the final court ruling will allow for effective protection of the geological structure of the greater Sankofa field.

“The ultimate split of the Greater Sankofa field, that is Afina and Sankofa, between ENI and Springfield, has already been decided upon by science. Therefore, the ruling in our opinion is very much welcome. The final court determination will allow the resource owner, Ghana, with the operators in both blocks to protect the integrity of the geological structure.”

“We also think the ruling will ensure that the development and management of the Greater Sankofa field are consistent with world-class practices with the ultimate aim of maximization of petroleum extraction,” he added.

ENI and Springfield disagree on import of court order for payment of 30% revenue into an escrow account

The stalemate between ENI Ghana and Springfield Ghana over the directive by then Energy Minister John Peter Amewu to execute a Unitization and Unit Operating Agreement (UUOA), which some stakeholders say is denying the country of much-needed revenue, has seen Springfield dragging ENI to court.

Springfield prayed the court for a number of reliefs including an order directing ENI and Vitol to cooperate with Springfield to produce and develop the accumulation of petroleum in the Sankofa and Afina fields as one unit as well as an order for the immediate preservation of revenues earned from the exploration and production of petroleum by the Defendants from the Sankofa field.

ENI has however maintained that further appraisal of Springfield’s Afina field needs to be done to determine its economic viability before a unitization program is embarked upon.

But according to Springfield, ENI has not only refused to comply with the unitization order by the then Minister, but has gone on to produce petroleum from the straddling contract areas which include their Afina field, thereby denying Springfield of enjoying the revenue that will accrue from the production activity, hence their lawsuit.

The court presided over by Her Ladyship Justice Mariama Sammo partly agreed with Springfield and ordered that from Friday June 25, 2021, 30% of all revenues accruing to ENI and Vitol from exploration and production activities from the Sankofa field be preserved in an interest bearing account until the substantive case is determined.

In a response to a request for comments by Citi Business News, ENI Ghana stated that it has taken note of the ruling of the High Court and is waiting to receive the full detailed ruling of the Court and review same in order to establish the impact it could have on their current operations. They also added that they fully expect to take the appropriate steps necessary in order to protect their operations in the country, including appealing against this ruling.

Commenting on the ruling, Kevin Okyere, CEO and founder of Springfield, described the ruling as a “welcome vindication of Springfield’s position on the issue of unitization and a positive result”. Mr. Okyere added that Springfield looks forward to working with Eni as the operator of the unitized field in maximizing the production and the economic benefits for all stakeholders, including the Government and citizens of Ghana.

 

 

 

 

 

 

 

 

Post: citibusinessnews.com

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