AfrOil: Ghana considers reducing stake in oil exploration amid regional competition

Ghana’s Petroleum Commission is exploring the possibility of reducing the country’s 15% mandatory stake in oil exploration projects, as competition from other African nations intensifies, threatening to divert vital investments away from its oil and gas sector.

Egbert Faibile Jnr, chief executive of the Petroleum Commission, has called for legal reforms to make Ghana more attractive to investors. He expressed concern about regulatory hurdles and the financial burden imposed on investors under the current framework.

“The conversation around that sector is very commercial, regulatory and also investment-related,” Faibile said in a Joy News report. “To drill one offshore exploratory well, a company will have to spend between $50mn to $70mn to be able to bring oil to the surface.”

Ghana’s existing laws, particularly the Petroleum Exploration and Production Act of 2016, require the state to maintain a 15% participating interest in all oil exploration projects – a figure Faibile argued is uncompetitive.

Faibile compared Ghana’s stance to its regional and global counterparts, noting that Ivory Coast, Angola, Nigeria, and even Guyana maintain a lower participating interest of about 10%. “If you’re an investor, where would you want to go?” he asked.

He urged the Ministry of Energy and other stakeholders to act swiftly to maintain Ghana’s competitiveness, particularly as the country prepares to host the Africa Oil Week conference in September 2025.

The high-profile event will bring together key stakeholders from across the oil and gas sector to forge partnerships and strategise on the industry’s development.

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