Accra High Court stops Gov’t from making payments to ENI for gas supplied from Sankofa Field
An Accra Commercial High Court has ordered the government to halt payments to Italian oil major firm, Eni and its partner Vitol.
The order by the court follows its decision to grant a motion for an interlocutory injunction restraining the government from making further monthly payments to Eni and Vitol for gas supplied to the state from the Sankofa Field.
The court order issued on July 12, 2022, specifically restrained the Ghana National Petroleum Corporation (GNPC), Ministries of Energy and Finance as third parties, from making any payments, whether outstanding or recurrent to the two oil companies pending the determination of an application brought against the three state organs by Springfield Exploration and Production Limited, a wholly-owned Ghanaian Energy company.
Springfield filed the motion on 20th June 2022 seeking the order by the court for GNPC, Ministry of Energy and Ministry of Finance to make all payments to the Registrar of the Court.
The action by the Ghanaian energy company is believed to be a sequel to an ongoing legal tussle that has seen Springfield win a judgment to preserve part of the proceeds from operations in the Sankofa Fields.
The Court also ordered GNPC and the two ministries to file accounts of all payments they have made to Eni and Vitol since the day of service on them of the pending application for an order of payment of money due and owing to the defendants.
This is to be carried out within 21 days beginning from 15th July 2022 and filed with the Court’s Registrar.
The Court noted that the reliefs sought by Springfield were both prohibitive and mandatory injunctions, having demonstrated that it had a ruling for preservation in its favour which had not been stayed for purposes of execution.
There is therefore a subsisting court order which it has the right to enforce and or protect through the process of law.
The trial Judge further noted that the Applicant (Springfield) had sufficiently demonstrated to the satisfaction of the court that there was a legal right worthy of the Court’s protection.
“The application is, therefore, neither frivolous nor vexatious as there are serious questions that ought to be determined in the pending application,” It added.
In the opinion of the Court, Springfield had demonstrated that despite the order of interim preservation that was obtained against Eni and Vitol, they had, through the filing of various applications in various courts frustrated the compliance and execution of the order of interim preservation.
“As if that is not enough, the resources which are alleged to be jointly owned by the Applicant and the Respondents are being dissipated by the Respondents on the blind side of the Applicant. The Respondents are further receiving payments monthly from third parties without accounting for same to the Applicant nor the Court,” it further noted.
The government, in 2020 declared the Sankofa Field and Afina Well unitized through the Minister of Energy and directed ENI and Springfield to commence the exchange of data with the view to unitizing the two areas to ensure optimization of the resource.
Since the directive, the two companies have failed to agree on the way forward. Whereas Eni rejects the idea saying it was a rushed decision, Springfield has been in court for the law to be enforced to the letter in line with the Petroleum laws of the country.
Meanwhile, Eni has said its existing gas sale agreement with the Government of Ghana (GoG) is helping the state save some $1bn annually.
