Fitch Solutions has disclosed that the recent sale of Aker Capital AS’s shares in its Ghana subsidiary Aker Energy AS marks a significant milestone for the Pecan Development Project, which is expected to reach a Final Investment Decision (FID) by 2024.

As AFC becomes the new operator of the field, Fitch asserts that it has become more optimistic about the Pecan project’s future.

Unlike Aker, AFC has not indicated that Lukoil’s participation is a red line for its development operations. “Therefore, we now anticipate that the Pecan project’s FID will be reached by 2024 at the latest,” Fitch further stated.

The Pecan field development had faced an impasse as the operator because Aker Energy AS, was hesitant to proceed with the involvement of Russian-based Lukoil due to the potential risk of international sanctions being levied on Russian oil and gas companies.

However, with the recent sale of Aker’s shares to AFC Equity Investment Ltd, owned by Africa Finance Corporation (AFC), a pan-African multilateral development financial institution, Fitch Solutions stated it believes that the project is now better positioned for success.

Previously, Aker held a 50% stake in the Deepwater Tano Cape Three Points Block (DWT/CTP), where the Pecan field is located. Following the sale, the new interest breakdown is AFC (50%), Lukoil (38%), Fueltrade (2%), and Ghana National Petroleum Corporation (GNPC) (10%).

AFC Invests USD200 million in Secured Bonds for Pecan Project

AFC has already invested USD200mn in secured bonds for the Pecan project’s development and served on the board for Aker Energy.

This history of backing the project, coupled with the completion of front-end engineering and design (FEED) and a plan for development (PDO) by Aker Energy before withdrawing, are expected to further expedite the development process.

The successful development of the Pecan field has the potential to significantly impact Ghana’s upstream outlook, given its estimated recoverable reserves of 334 million barrels of oil equivalent.

The Pecan project will be Ghana’s fourth major oil development, following Jubilee, TEN, and Sankofa Gye Nyame, and is expected to boost the country’s production capacity by 80,000 barrels per day.

All in all, the sale of Aker’s shares in Aker Energy to AFC has removed significant headwinds for the Pecan Development Project and paved the way for the project’s successful development.

Meanwhile, with a new operator in place and the completion of FEED and PDO, Fitch said it is optimistic about the project’s future and anticipate an FID by 2024.

Aker Energy will develop the Pecan Field with a re-deployed FPSO connected to a subsea production system in 2,700 meters below sea level. The development concept will build on experience derived from projects and operations in similar water depths and conditions globally, and application of advanced drilling operations.

In order to minimize risk exposure during project execution and field operations, and in an acknowledgement of the water depth, qualified technologies and well-known development solutions will be utilized.

The Pecan Field was discovered by Hess in 2012 and they had appraised the field with five reservoir penetrations. The appraisals and drill-stem tests showed promising results and a light, under-saturated oil with favourable oil characteristics suited for waterflood.