Chief Executive Officer (CEO) of the Petroleum Commission, Egbert Faibille Jnr, has said the Covid-19 pandemic has resulted in the cancellation of over 98 upstream contracts worth more than $389 million.
According to him, shocks suffered by the oil sector from the Covid-19 pandemic has not only affected the economy but has also impacted on work obligations and operations of companies involved in Ghana’s upstream sector.
Some of the contracts cancelled include the five-year Maersk Drilling contract terminated in June 2020 together with associated sub contracts, contracts awarded by Aker Energy, AGM, Eni, GOSCO and Springfield from the last quarter of 2019 to the first quarter of 2020.
The consequential effect of the cancellation of contracts amidst the already reduced workforce in the industry resulted in layoffs of both expatriate and local personnel.Again, more than 500 Ghanaian workers in the industry are expected to lose their jobs as result of the pandemic.
Mr Faibille Jnr made the disclosure during a forum with the Western Regional House of Chiefs at Sekondi.
The forum was for the Petroleum Commission to interact with the Western Regional House of Chiefs and update them on recent developments in the sector.
Speaking further, Mr Faibille explained that the shortfall in revenue in the upstream sector this year was significant and had been made worse as a result of companies investing heavily to enable staff work remotely to keep the industry running.
He also pointed out that the COVID-19 pandemic is likely to delay the country’s second licensing round as the Government prioritises managing the domestic impact of the virus.
Project Evaluation Manager at the Commission, Ebenezer Harmah, also in a presentation on the ‘Impact of COVID-19 on Ghana’s Upstream Sector,’ to the Chiefs revealed that some companies due to the impact of the pandemic have reduced workforce by 50 per cent.
“Almost 100 per cent of workers have been laid off either temporarily or permanently by contractors and subcontractors. Again, over 450 potential direct and indirect temporary job opportunities have been lost due to the suspension of drilling campaigns by Amni, GOSCO, Eni and Eco Atlantic,” he added.
He added that the 2020 Ghana Upstream Sector Internship Programme (GUSIP) has also been postponed stressing that it will cause a delay in skills transfer.
“For Yinson, there is a 33 per cent reduction in the personnel on board the FPSO John Agyekum Kufour. For MODEC, there is a 52 per cent reduction in personnel on board the FPSO John Evans Attah Mills and a further 56 per cent in the personnel on board the FPSO Kwame Nkrumah. For Eni, there is a 46 per cent reduction in personnel on the Onshore Receiving Facility and for Tullow, there is 50 per cent staff rotation.”
