PIAC flags risks in US$205m TEN FPSO acquisition

By Kizito CUDJOE

The country’s petroleum revenue oversight body has raised a red flag over a planned  US$205million acquisition tied to the declining Tweneboa-Enyenra-Ntomme (TEN) oilfield, warning that the deal risks locking the state into fresh long-term exposure under the guise of cost savings.

The Public Interest and Accountability Committee (PIAC) is calling for independent scrutiny of a planned purchase of the aging Floating Production, Storage and Offloading (FPSO) vessel Prof. John Evans Atta Mills, shifting attention from the field’s well-documented production decline to the integrity of decisions now being taken to extend its life.

With no new drilling activity and rising financial pressures, PIAC is effectively demanding that regulators – particularly the Petroleum Commission (PC) – demonstrate that efforts to reset TEN’s economics serve the public interest rather than simply easing operator constraints.

In a departure from its usual reporting format, PIAC’s 2025 report introduced a ‘Box Issue Highlight’ – urging the PC to undertake a comprehensive review of TEN’s cost history and procurement decisions, subject the FPSO acquisition to independent scrutiny and require transparent reporting on production optimisation and infill drilling plans.

The TEN field, operated by Tullow Ghana Limited, began production in 2016 but has since seen a steady decline from over 40,000 barrels per day in 2017 to about 16,000 barrels per day in 2025, raising questions about the viability of further investment without a clear recovery strategy.

PIAC noted that no drilling or completion activity took place on the field during the year, while about 81 percent of produced gas was reinjected – pointing to persistent geological and commercial constraints.

A central driver of TEN’s strained economics has been the high fixed cost of leasing the FPSO. In February 2026, Jubilee partners – Tullow (54.84 percent), Ghana National Petroleum Corporation (GNPC)/Explorco (20.95 percent), Kosmos Energy (20.38 percent) and PetroSA (3.82 percent) – signed a sale and purchase agreement to acquire the vessel for US$205million in a bid to eliminate lease costs and extend the field’s life to 2040.

However, the FPSO built in 1998 will be nearing 30 years old by the time the transfer is completed in 2027, raising concerns about the asset’s long-term value relative to the field’s declining output.

The financial backdrop further complicates the picture. Government owes about US$50million in TEN-specific development debt to Tullow alongside broader gas payment arrears, while GNPC’s carried development costs remain partially unresolved. Tullow has indicated that its 2025 free cash flow was materially impacted.

PIAC explained that its box issues are intended to draw attention to emerging policy risks, particularly in the context of the Ghana Petroleum Funds’ (GPF) future and implications of the 2025 amendments to the Petroleum Revenue Management Act (PRMA).

“These developments underscore the need for stronger safeguards, greater transparency and broader stakeholder engagement to preserve the long-term integrity of the country’s petroleum revenue management framework,” the Committee said.

The report, PIAC’s 15th annual and 29th statutory submission, also highlights broader strain in the sector. Crude oil production fell to 37.3 million barrels in 2025 – down from 48.24 million barrels in 2024 and dragging petroleum revenue down by 43 percent from US$1.36billion to US$770million.

Against this backdrop, PIAC Chairman Richard Kojo Ellimah urged government, through the PC, to develop a clear framework that attracts investment into existing producing fields, particularly TEN, where output has consistently underperformed initial projections, while strengthening regulatory and fiscal regimes and improving data acquisition in new basins.

The Committee also pointed to the performance of petroleum-funded investments, noting that an allocation of US$30million from the Annual Budget Funding Amount (ABFA) to the Ghana Infrastructure Investment Fund (GIIF) for the Accra International Airport project has yielded US$17.9million in interest and fee income between 2017 and 2025, representing nearly 60 percent of the original capital deployed.

It therefore urged government to consider restoring GIIF to the PRMA framework and allocating ABFA resources to commercially viable infrastructure projects in line with the Fund’s mandate.

Even so, PIAC’s central concern remains the direction of decision-making around mature fields such as TEN, where declining production, aging infrastructure and unresolved financial obligations are converging – raising the stakes for a transaction that could define whether the field’s final phase delivers value or deepens fiscal risk.

The post PIAC flags risks in US$205m TEN FPSO acquisition appeared first on The Business & Financial Times.

Read Full Story