The Attorney-General and Minister for Justice, Godfred Yeboah Dame, issued a press statement celebrating a significant victory for Ghana in the international arbitration case brought by Eni Ghana Exploration and Production Limited and Vitol Upstream Ghana Limited.
The case, heard by the International Arbitration Tribunal, resulted in a Final Award favoring the Government of Ghana and the Ghana National Petroleum Corporation (GNPC), the AG noted.
“The Tribunal dismissed the claimants’ request for a declaration that Ghana breached the Petroleum Agreement.
“It found that while the Unitisation Directives breached Article 26(2) of the Petroleum Agreement, this was specific to the circumstances under which they were issued and not an overarching breach.”
Hon. Godfred Yeboah Dame, Attorney-General and Minister for Justice
The Attorney-General highlighted that the Tribunal affirmed Ghana’s authority to unitize oil fields to ensure efficient exploitation, paving the way for the joint development of the Afina and Sankofa fields under Ghanaian laws and relevant agreements.
“The Tribunal denied the Claimants all claims to monetary damages or compensation. The Claimants claimed Seven Billion United States Dollars (US$7 bn).
“This was subsequently reviewed to Nine Hundred and Fifteen Million United States Dollars (US$915 M) plus interest by the end of the proceedings. This was dismissed in its entirety.”
Hon. Godfred Yeboah Dame, Attorney-General and Minister for Justice
Financial Implications
Regarding the allocation of fees and costs, the Tribunal ruled that each party would bear its legal fees and costs. The parties were also required to pay €189,000 each to the Stockholm Chamber of Commerce (SCC), representing half of the SCC’s charges.
Attorney-General Godfred Yeboah Dame highlighted the ruling as a significant victory for Ghana. He emphasized that the decision reaffirmed Ghana’s rights over its natural resources and the integrity of its regulatory framework for oil field exploitation.
Dame addressed the proliferation of false publications by individuals and groups not involved in the proceedings, attempting to discredit the Government’s success.
“The public is hereby entreated to disregard such false publications about the “ENI/Vitol Award” which, within the circumstances, represents a major victory for the Republic of Ghana.”
Hon. Godfred Yeboah Dame, Attorney-General and Minister for Justice
These rulings underscore Ghana’s commitment to lawful and efficient resource management. By affirming the Government’s right to unitize oil fields, the Tribunal has bolstered Ghana’s ability to regulate and optimize the exploitation of its oil reserves.
The dismissal of the substantial monetary claims against Ghana prevents a significant financial burden, preserving resources that can be redirected to national development initiatives.
The Attorney-General reiterated his office’s dedication to defending Ghana’s interests in both local and international arbitration forums. He assured that the Government would continue to contest any claims aimed at imposing undue judgment debts on the country. This stance is part of a broader effort to protect Ghana’s natural resources and uphold the country’s economic sovereignty.
The dispute centered on the Government of Ghana’s issuance of Unitisation Directives, which mandated the joint development of the Afina and Sankofa oil fields. The claimants argued that these directives violated the Petroleum Agreement between the parties by refusing to withdraw or prevent reliance on them by third parties.
They further sought a declaration that Ghana notifies its High Court, Court of Appeal, and Supreme Court that the directives breached the Petroleum Agreement.
The public and various stakeholders in the oil and gas sector have largely welcomed the Tribunal’s decision. Industry experts view the ruling as a positive development for Ghana’s regulatory environment, potentially attracting further investments in the sector.
The Final Award by the International Arbitration Tribunal marks a pivotal moment for Ghana’s oil and gas sector. It reinforces the Government’s regulatory authority and mitigates potential financial liabilities. As Ghana continues to develop its natural resources, this victory sets a precedent for the country’s legal and economic fortitude on the international stage.
The Attorney-General’s press statement not only celebrated a legal victory but also reinforced the government’s unwavering commitment to safeguarding Ghana’s economic and resource interests.
The dismissal of the substantial monetary claims and the affirmation of Ghana’s rights in oil field unitisation stand as crucial milestones in the country’s ongoing efforts to ensure fair and just management of its natural resources.
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