…. Threatens legal action
The Board Chairman of the Ghana National Petroleum Corporation (GNPC), has strategically avoided a conflict with his supervisory minister, Dr Matthew Opoku Prempeh, threatening to rather sue the 29 Civil Society Organization (CSOs) calling for his dismissal for attempting to sell 50percent stake in Jubilee Holdings Limited (JOHL) to PetroSA.
Freddie Worsemao Armah Blay, in his second public statement after the scandal was first reported by The Herald, sought to question the intellectual capacity of the CSOs on Ghana’s Companies Act 2019 (Act 992) and transfer of shares, and directed them to google search the requirement of the law, before jumping into conclusion on what he was doing with PetroSA.
“Ghana is a country of law, and there are laws and procedures governing the sale and transfer of shares, under Ghana’s Companies Act 2019 (Act 992), even for private companies. I encourage all my accusers, and the public to Google “what is the procedure for share transfers in Ghana”, educate themselves, and draw their own conclusions on the veracity or duplicity of the allegations. Shares of a company are not a pack of cigarettes anyone, and for that matter, the Chairman of GNPC can keep in his or her pocket and vend by the street!”, he said yesterday.
The likes of Ben Boakye, the Executive Director of the Africa Centre for Energy Policy (ACEP) among others, had expressed shock about reports that Mr Blay, a lawyer by profession, wrote and signed letters that sought to allocate interest in Ghana’s oil fields to Petroleum Oil and Gas Corporation of South Africa (PetroSA).
The Energy Minister, had described the ex-New Patriotic Party (NPP) National Chairman’s conduct as “scandalous” in a letter to President Nana Akufo-Addo, but in a statement, Mr Blay, rather went after the CSOs calling for his resignation, as well as that of GNPC CEO, Opoku Ahweneeh Danquah, insisting that the call was deeply regrettable and unfortunate.
He did not address the corporate governance matters, but said “CSOs, are expected to protect the interests and rights of civil society, seek the public good and national interest. Instead, the 29 CSOs that have called for my resignation, chose to engage hastily in this matter without seeking the facts, and rather misinform the public, in pursuit of ulterior motives and vested interest.
“I have taken due note of the libellous statements against me by my detractors including the said CSOs, and reserve the right to take legal action against these organizations and anyone engaged in this diabolic exercise of destroying my name and reputation.”
The call for Mr Blay’s resignation comes in the wake of GNPC’s intention to sell a 50percent stake in Jubilee Holdings Limited (JOHL) to PetroSA, despite the substantial revenue potential this interest holds for the state.
Addressing the press on Tuesday, May 23, the Coordinator for the coalition, Abdul Karim Mohammed, said the continuous presence of Mr Blay and Ahweneeh Danquah, closely associated with petroleum operations, poses significant risks to Ghana’s interests.
The CSOs are made up of the Africa Centre for Energy Policy (ACEP), Centre for Democratic Development (CDD-Ghana), the Chamber of Petroleum Consumers Ghana (COPEC), Imani Centre for Policy and Education and 25 others.
The CSOs, also accused the two men of working against the interest of the state. But Mr Blay, claims the allegations surrounding the supposed “surreptitious,” “clandestine,” and “scandalous” sale of so-called GNPC shares are unequivocally false.
“There is no intention by GNPC or me as its Chairman, to divest 7% shareholding in JOHL nor has there been any claim by PetroSA to acquire shareholding interests in JOHL. Such claims can only stem from an uninformed and malevolent mind.”
The Minister had written to the President complaining that “the Chairman of the GNPC Board, in the letter under reference, is inviting PetroSA to preempt the 7% interest that was recently acquired by the Government of Ghana from Anadarko West Cape Three Points Company (“Anadarko”) and proposing an equal split of the Deep Water Tano (“DWT”) portion which would decrease the Government’s interest”.
“We wish to bring this action of the Chairman, which is in direct contravention of the Government of Ghana’s express directives on the subject matter, to the urgent attention of His Excellency the President”, a letter dated 16th May 2023 and addressed to the President had insisted.
It explained how the asset came to Ghana saying “His Excellency the President will recall that Anadarko, a partner in the West Cape Three Points (“WCTP”) and the DWT Petroleum Agreements (“PAs”) and the Jubilee and TEN fields triggered the requirements for Government’s consent to a transaction in which Anadarko proposed to sell its entire interests in the DWT and WCTP PAs to Kosmos Energy Holdings Limited (“Kosmos”). After a series of negotiations and a Settlement. Agreement reached with the Ghana Revenue Authority (“GRA”), the Government negotiated with Anadarko that Kosmos could acquire the said stake on condition that the State will purchase 7% of the stake worth about US$164.8 million. On this basis, the Government of Ghana granted its consent to the transaction. The Ministry of Energy wrote to the Ministry of Finance (“MoF”) on 29th September, 21121 to utilize part of the negotiated tax settlement of $170m to support GNPC to acquire the interest which Anadarko had carved-out in the offshore entity Jubilee Oil Holding Limited (JOHL) in Cayman Islands. The Minister on the same date directed the GNPC to transfer the interest in JOHL to Explorco as a requirement of law. It is noted that the acquisition by the State was done with His Excellency’s prior approval on 22nd July, 2021”.
In the estimation of ACEP’s Mr Boakye, if properly approved the Chief Executive Officer, Mr Opoku Ahweneeh Danquah, should have handled such a transaction.
Speaking in an interview on TV3’ Ghana Tonight on Tuesday, May 23, Mr Boakye said, “It is surprising to find that in such a serious organization, you would have the Board Chair directly writing and signing letters. One would have assumed that once there is a CEO, the CEO will be the one doing those operational leg works and doing the signing, even if the decision is taken.”
The Energy Governance Professional noted that this does not augur well for corporate governance in the GNPC, “this really points to certain collusion at some level within the organization to really undermine the broader decision of the organization to do this. And it is becoming clear that not the entire Management or Board was involved. Even for the Board Chair to take those decisions without reference to any law that allows him to activate such preemptions is weird and I found that shocking.”
Below are details of Mr Freddie Blay’s PRESS RELEASE – RE: “PRE-EMPTION OF JOHL ACQUISITION OF ANADARKO INTEREST”
Recently, Ghana’s media landscape has been inundated with unfounded and malicious allegations surrounding Freddie Blay, the Chairman of GNPC. These baseless claims, propagated through statements attributed to a purported group of 29 Civil Society Organizations (CSOs), have gone so far as to demand my resignation as Board Chairman.
My detractors, without verifying the facts with GNPC, make baseless claims suggesting my involvement in a supposed “scandalous” transaction aimed at offloading 50% of GNPC’s existing stake in the Deepwater Tano Contract Area (DWT). Furthermore, they assert that this action constitutes a divestment of the State’s beneficial interest.
Interestingly, there are others who assert, quite sadly, that they have uncovered a secretive and covert endeavour by GNPC and its board chairman to sell the 7% shares acquired by the Republic of Ghana from Anadarko West Cape Three Points Company (Anadarko) to Petroleum Oil and Gas Corporation of South Africa (Petro SA). To present the truth, I provide the following information for those seeking accurate insight.
Ghana is a country of law, and there are laws and procedures governing the sale and transfer of shares, under Ghana’s Companies Act 2019 (Act 992), even for private companies. I encourage all my accusers, and the public to Google “what is the procedure for share transfers in Ghana”, educate themselves, and draw their own conclusions on the veracity or duplicity of the allegations. Shares of a company are not a pack of cigarettes anyone, and for that matter, the Chairman of GNPC can keep in his or her pocket and vend by the street!
The allegations surrounding the supposed “surreptitious,” “clandestine,” and “scandalous” sale of so called GNPC shares are unequivocally false. There is no intention by GNPC or me as its Chairman, to divest 7% shareholding in JOHL nor has there been any claim by PetroSA to acquire shareholding interests in JOHL. Such claims can only stem from an uninformed and malevolent mind.
The Matter of the Petroleum Oil and Gas Corporation of South Africa (“PetroSA”)
In March 2006, the Government of the Republic of Ghana (“The State”) represented by the Minister for Energy (“Minister”), the Ghana National Petroleum Corporation (“GNPC”), executed a Petroleum Agreement (“PA)” in respect of the Deepwater Tano Contract Area (“DWT”), with Tullow Ghana Limited (“Tullow”), Sabre Oil and Gas Limited (“Sabre”), Kosmos Energy Ghana HC (“Kosmos”) and Anadarko Offshore Holding Company, LLC (“AOHC”). These companies are hereinafter collectively referred to as “Contractor”. GNPC as is mandatory in the PA holds a 10% carried interest in DWT.
PetroSA, in July 2012 completed the acquisition of the shares of Sabre after receiving the consent of the Minister of Energy, the Honourable Joe Oteng-Adjei, earlier in February of the same year. By the acquisition of the assets and liabilities of Sabre, PetroSA legally assumed the equity interests of Saber as a Contractor in the PA relating to the DWT.
Specifically, PetroSA bought out Sabre’s interest in three assets i.e., the producing Jubilee field (1.7%), the Deepwater Tano Block at (4.05%), and the West Cape Three Points Block at (1.854%). Also, and by virtue of becoming a Contractor under the PA, PetroSA also, became a party in the Joint Operating Agreement (JOA) relating to the DWT.
As a party to the DWT JOA, PetroSA like all other parties in the Agreement, is entitled to the benefits and rights granted in the said agreement. This includes the ability to exercise a right to pre-empt any divestments to any unidentified third party for any intended transfers of all or a portion of and Participating Interests, whether directly or indirectly by assignment, merger, consolidation, or sale of stock or shares or other conveyance.
In 2021, AOHC created and incorporated a new Company i.e., Jubilee Oil Holdings Limited (“JOHL”), in Cayman Islands. JOHL, and Anadarko assigned to JOHL (“JOHL Transfers”) a 7% Participating Interest in the DWT JOA and a 5.95% interest in the DWT Petroleum Agreement. It also entered into a sale and purchase agreement with Kosmos Energy for the sale of Anardarko, and with the GNPC for the sale of JOHL.
Post the acquisition of JOHL by GNPC, after serving a notice to pre-empt rights to purchase the 7% Participating Interest in the DWT JOA currently held by JOHL, PetroSA has since engaged GNPC to acquire said Interests.
As a compromise solution, we have proposed the option of a 50:50 split of the 7% shares GNPC was holding. It is important to note that we have yet to outline specifics for the finality on the matter, and this compromise is subject to confirmation, and subsequent advice of the Minister. We are still in the stage of ongoing discussions.
GNPC’s doors remain wide open to all Civil Society Organizations and individuals alike. I extend an invitation to investigate and ascertain the facts before succumbing to orchestrated and futile frenzies.
The call for my resignation, as well as that of the CEO, in relation to this matter is deeply regrettable and unfortunate. CSOs are expected to protect the interests and rights of civil society, and seek the public good and national interest. Instead, the 29 CSOs that have called for my resignation, chose to engage hastily in this matter without seeking the facts, and rather misinform the public, in pursuit of ulterior motives and vested interest. This is detrimental to the public good, and the national interest.
I have taken due note of the libellous statements against me by my detractors including the said CSOs, and reserve the right to take legal action against these organizations and anyone engaged in this diabolic exercise of destroying my name and reputation.
FREDDIE WORSEMAO ARMAH BLAY
CHAIRMAN
Dated: Thursday, 25 May 2023 for release to all Media Houses and Relevant Internet Portals
