Oil and Gas: President Mahama calls for aggressive drilling and investments

Adamu Issah
Accra, Ghana
September 20, 2025

O Ghana has not signed a petroleum agreement since 2018, according to the Public Interest and Accountability Committee (PIAC). On May 12th, 2025, during the Africa CEO Forum 2025, in Abidjan, Côte d’Ivoire, President John Mahama outlined plans to revitalize this ailing sector. He asked investors to prospect and invest in Ghana’s oil and gas. ‟Everybody who has any assets should be pumping like there’s no tomorrow”¹, he told oil companies, asking them to come to Ghana. Analysts have likened this declaration to similar calls from US President Donald Trump², who has brushed aside concerns over the impact of fossil fuel on climate change. Ghana wants to increase oil production before transitioning to renewable energy.

Ghana is recovering from a devastating economic crisis, which led the country into a default on its public debt, triggering high inflation and a protracted depreciation of the national currency. Ghana is relying on its extractive sector to boost the economy. In his speech, President Mahama highlighted his commitment to renewable energy but emphasized the importance of oil and gas for the economy and for the country’s energy mix.

Declining production

Crude oil production declined for the fifth consecutive year in 2024. Production has dropped from 71.44 million barrels in 2019 to 48.25 million barrels in 2024, representing a five-year decline of 7.4 percent³. In 2023, crude oil export revenues plummeted, falling 30 percent from US$5.43 billion to US$4 billion⁴. Ghana’s oil output has been on a downward slide for a decade. Ghana has three productive offshore fields: the largest productive field is the Greater Jubilee, which in 2024 yielded 66.02 percent of output. The second and third are the Tweneboa Enyenra-Ntomme (TEN) and the Sankofa-Gye Nyame (SGN) which contributed 14.06 percent and 19.91 percent of total output. These results are a mirror image of production between 2019 and 2023.

PIAC 2024 report

The 2024 production figures represent a fifth consecutive year of decline. Ghana’s three productive fields are following a natural production decline after 14 years of service, according to the Public Interest Accountability Committee (PIAC). In addition, equipment malfunctions and maintenance delays have contributed to the lowering of output.

Echoing the president’s call, the Ghana Energy Commission is urging upstream oil companies operating in Ghana to increase exploration. The Ghana Ministry of Energy and Green Transitions has granted extension to upstream companies such as ENI Exploration Ghana, Base Energy and GNPC Explorco to continue exploration and seismic data collection. The ministry has also authorized Eco Atlantic, Pecan Energies and Medea to continue drill in its licensed wells. Other companies in the race for new oil discoveries are Tullow, GNPC and Springfield.

The Ghana Energy Commission is not expecting an increase in production before 2026. The Commission has announced a shutdown for major maintenance work in the Jubilee and TEN fields. Because of the aging of Ghana’s offshore infrastructure, there is the need to increase the frequency of these shutdown periods to ensure optimal and safe operations.

In search of investments

Private investments have also stagnated despite incentives to attract investors. In 2025, investment in Ghana upstream is projected to reach US$1.2 billion representing a marginal increase of 9 percent from 2024 (US$1.1 billion). The Ghana Petroleum Commission estimates that Ghana needs US$2.8 billion in 2025 alone and that Ghana needs substantial investments to explore, develop and drill new fields. But according the Commission, ‟companies continue to prioritize small, modular, or phased projects over megaprojects”. These investments require less capital, offer shorter payback periods, and has lower long-term demand risks, in a context where the volatility of oil prices continues to create disincentives for investors. Ghana is bracing for downward pressure on oil prices due to oversupply risks, slowing demand, energy transition and geo-political risks.

Incentives to investors

The government of Ghana offers incentives to investors, which include tax and administrative facilitation measures. Other incentives include favorable accounting treatments such as accelerated depreciation allowances for capital expenditure on assets relating to mineral and petroleum exploration and production rights. However, according to the Ghana Upstream Petroleum Chamber, over the past five years ‟efforts to reverse the decline of the sector have been unsuccessful”.

The Chamber argues that potential investors continue to face stumbling blocks. The first is the local content law. The government of Ghana passed a local content law in 2013. This law requires investors to accept a minimum of five percent equity stake from an indigenous company in any hydrocarbon exploration and production project. Alternatively, the law mandates that international service companies form joint ventures with indigenous Ghanaian companies, where the Ghanaian company must hold at least a ten percent participating interest. The Ghana local content law also prescribes rules regarding the provision of employment for Ghanaians.

This law has been beneficial to the Ghana. It has spurred the emergence of indigenous companies along the oil and gas value chain while creating jobs. According to the US Trade Administration that foreign companies have been able to comply with requirements for local personnel. They achieve this by hiring Ghanaians in management positions and also general staff. The USTA also explains that international oil companies look for local companies across the entire upstream value chain, from direct participation, storage, transportation, and haulage, to services and maintenance. But the downside of Ghana’s current local content law is that gives local companies potential access to proprietary technologies without adequate protection for incoming investors.

Investment climate

Since 2007. the international business environment has evolved but the Ghanaian hydrocarbon legislation has been slow to catch up. This time lag is leading to environmental and contractual incongruences in the sector. As a result, Ghana’s upstream petroleum industry has recoded protracted and costly litigations stemming from conflicts between international companies, indigenous companies or even state institutions. Disputes have emerged from differing interpretations of contractual terms in petroleum agreements and from claims for fair and transparent processes.

Springfield, an indigenous Ghanaian oil and gas company, sued ENI and Vitol, seeking compliance with a directive for unitization and an accounting for exploration activities. The Ghanaian government initially ordered the unitization (combining operations) of the fields in dispute due to their proximity, but this was met with legal challenges and ultimately led to arbitration. In 2024, the newly elected government of President John Mahama, instructed the withdrawal of the proposed unitisation between Eni’s Sankofa Gye Nyame (SGN) Field and Springfield’s West Cape Three Points (WCTP) Afina discovery ⁵. In another case, Tullow Ghana successfully challenged a US$320 million assessment for Branch Profit Remittance Tax (BPRT). The tribunal ruled in favor of Tullow Ghana arguing that BPRT was not applicable to Tullow Ghana since it falls outside of the tax regime provided for in the Petroleum Agreements.

Ghana must also consider the global shift towards renewable energy and the competitiveness of the sector in West Africa and in the Gulf of Guinea. In recent years Cote d’Ivoire, Senegal, Niger and Namibia have emerged as main destinations for investments besides giant producer Nigeria.

The region is attracting investment in the sector. In 2024, Senegal became an oil producer after the completion of a US$5.1 billion project. Also in 2024, Nigeria’s US$20 billion Dangote Refinery began production, heralding a stiff competition with planned Ghana Petroleum Hub. Upstream, on May 06th, 2025, ExxonMobil announced a US$1.5 billion in deep-water exploration and development, which the US company will implement between Q2, 2025 – 2027 to revitalize production in the Usan deepwater oil field. In Cote d’Ivoire, Eni is investing US$10 billion in the development of the Baleine field offshore in Cote d’Ivoire. The company discovered oil in this field in 2021 and began production in August 2023. It announced that Baleine contains 2.5 billion barrels of oil and 3.3 trillion cubic feet of gas reserves.

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