UK oil firm in major new find off Ghana

14th September 2010, Comments 0 comments

British firm Tullow Oil said Tuesday it has found what could be among the largest recent oil discoveries in Africa off the coast of Ghana, with the field holding a potential 550 million barrels.

The new find in Tullow's deepwater Tano licence comes just three months before Ghana is expected to start pumping crude from the Jubilee field, discovered three years ago and one of the biggest finds in west Africa of the last decade.

Owo field is estimated to hold between 70 million and 550 million barrels of light, sweet and high quality crude.

The Owo field "is potentially the largest light oil discovery in Africa since our own Jubilee oil field discovery three years ago," Tullow's head of investor relations Chris Perry told AFP.

The Jubilee field, discovered in 2007, is believed to hold some 1.8 billion barrels of reserves.

The new find will attract further investment to Ghana, viewed as a beacon of democratic stability in the region, one analyst said.

The latest discovery "goes to show that Ghana is a very productive oil frontier and this will increase industry interest," said Alex Vines of the British think-tank Chatham House.

But "political will" will be needed to manage the resources well and not neglect other sectors, he said, adding: "Ghana leadership is not ignorant of what happened elsewhere (in Africa)."

Government officials have vowed to carefully oversee the country's oil reserves and revenue, aiming to avoid the mismanagement and corruption that has plagued nearby Nigeria, one of the world's largest producers.

Tullow has a 50 percent interest in Tano, where it operates alongside several global oil giants and Ghana's state-run oil firm, the Ghana National Petroleum Corporation.

"We have a new asset in our portfolio which is considerably more valuable than expected," Perry said.

Commercial oil production is expected by year's end.

Ghana's oil discoveries have however sparked a row with Ivory Coast over their maritime border, with Accra accusing Abidjan of claiming part of its waters.

Ghana is already the world's second biggest cocoa exporter after neighbouring Ivory Coast and Africa's second largest gold producer.

Despite its natural riches, roughly a third of Ghana's 23 million people live below the poverty line, according to World Bank estimates.

© 2010 AFP

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