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Petroleum industry

Corruption Allegations Complicate ExxonMobil Deal in Ghana's Oil Sector

Strategic Insights

— 1 min read

Ghanaian authorities are preparing to file criminal charges against EO, a company set up by two allies of former President John Kufuor, amid allegations of corruption involving a Texas oil company and its local partner that secured control of a key oil block. The case threatens to complicate the sale of Kosmos's stake in the Jubilee oil field to ExxonMobil, a deal valued at $4bn. Ghanaian officials suspect that EO used its access to top officials in the former government to gain a hold on the offshore oil block and win more favourable terms for itself and Kosmos.

Key Takeaways:

  • Ghanaian authorities are investigating corruption allegations involving EO, a company set up by two allies of former President John Kufuor, and its partner Kosmos, a Texas oil company.
  • The case threatens to complicate the sale of Kosmos's stake in the Jubilee oil field to ExxonMobil, a deal valued at $4bn.
  • Ghanaian officials suspect that EO used its access to top officials in the former government to gain a hold on the offshore oil block and win more favourable terms for itself and Kosmos.
  • EO's directors have denied any wrongdoing, and Kosmos has also denied allegations of wrongdoing against it.
  • EO has a 3.5 per cent stake in the offshore oil block, which could be worth more than $200m.
  • The deal between Kosmos and EO involved Kosmos financing EO's share of exploration and development costs, which Ghanaian officials have described as "unusual".

Statistics:

  • $4bn: The value of the proposed sale of Kosmos's stake in the Jubilee oil field to ExxonMobil.
  • 3.5 per cent: EO's stake in the offshore oil block.
  • $200m: The estimated value of EO's stake in the offshore oil block.
  • 2007: The year Kosmos found commercial quantities of oil in the offshore oil block.

Sources:

  • "US and Ghanaian authorities investigate Texas oil company and local partner over corruption allegations" by William Wallis, Martin Arnold, and Brooke Masters in London, Financial Times, n.d.
  • "Ghanaian officials suspect EO used influence to gain favourable terms for partner Kosmos" by William Wallis, Martin Arnold, and Brooke Masters in London, Financial Times, n.d.

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