Obama to Show his Hand in Ghana's Jubilee Filed in Play by Exxon

Kosmos Energy signed on October 12 an exclusive and binding agreement with ExxonMobil ("Exxon") to sell its stake in the Jubilee oil field discovery off the coast of Ghana (WSJ).  The field holds 1.8 billion barrels of sweat crude.  Today comes China National Offshore Corp. ('Cnooc") forward to spoil the deal together with the Ghana National Petroleum Corp (GNPC") to challenge the Exxon bid of $4 billion.

There are few major oil discoveries and/or new major prospects where Western international oil companies can invest with confidence and meet their obligations on time due to their superior technology, superior project management and a ready to spend exploration budget.  The interference of Cnooc together with GNPC is disturbing and smells of corruption in Ghana.  Cnooc and GNPC do not have the expertise to quickly monetize the Jubilee field to the benefit of Ghana and the U.S. investors, represented by Exxon.  

Cnooc has tried before to get their hand on advanced deep sea exploration technology with their bid for Unocal that was spoiled by the Bush Administration and Chevron took over Unocal.  Now it is President Obama's time and place - "hic Rhodos hic salta" - to demonstrate his geopolitical and energy leadership;

We can not let China use our debt money to restrict our global exploration for oil & gas reserves.  Of course, opening up the OCS and concentrate on the Arctic Obama could further support our energy security and independence.  Lets hope he is successful in Ghana and also at home with a realistic energy legislation, supporting the national gas & oil industry.

 

Hans Linhardt consults with leading institutions through GLG