Page 5 - AfrOil Week 34 2022

AfrOil COMMENTARY AfrOil

The Russian major is, despite its protests, actu- Brussels imposed a ban (with some limits)
ally a target of various sanctions regimes. It has on Russian crude oil and petroleum product
been a target of US sanctions since the Russian imports into the EU in June of this year, its intent
seizure of Crimea in 2014. Moreover, it has been was to reduce the volume of oil and fuel coming
effectively barred from directly selling crude into the bloc from Russian territory.
and refined petroleum products to the EU since Once again, it is not at all clear whether that
June 1, when Brussels adopted a general ban on intent should be extended to an (arguably) inde-
imports of Russian oil and fuel. pendent subsidiary of Lukoil that is (indubita-
Additionally, it has come under sanc- bly) operating outside Russian territory and will
tion from various industry associations such (almost certainly) never extract a single barrel of
as the Oil Companies International Marine oil inside Russia.
Forum (OCIMF). That group announced in
mid-March of this year that it was suspending Heading for court?
Lukoil’s participation in the Ship Inspection This disagreement between Aker and Lukoil
Report (SIRE) programme, a global inspection is new, so there is no way to tell yet how it will It is not clear
reporting system. play out. However, it would not be surprising
if the Russian company pursued arbitration or whether Lukoil’s
Degrees of vulnerability some sort of legal remedy rather than bowing
Even so, the trade restrictions may not techni- out (for the appropriate price) so as to save its Ghanaian
cally apply to the Pecan project. Norwegian partner the bother of dealing with a subsidiary
Lukoil is, like many other vertically inte- difference of opinion.
grated international oil companies (IOCs), not Lukoil has already made clear that it is will- is subject to
a single entity but an umbrella organisation with ing to criticise Aker for its willingness to bring
many subsidiaries that have varying degrees of Ghana National Petroleum Corp. (GNPC) on sanctions
independence from their parent company. It board as a partner in the Pecan project, and it
has been working through one such subsidiary, is now equally willing to argue about sanctions.
Lukoil Overseas Ghana Tano Ltd, to uphold its As such, the matter may eventually end up in
responsibilities as a shareholder in the Pecan court – or, more accurately, before an arbitra-
project. tion panel.
It is not at all clear whether that subsidiary is Currently, the Russian major has a 38% stake
vulnerable. In its list of Russian entities subject in Deepwater Tano/Cape Three Points (DWT/
to Ukraine-related sanctions, the US Treasury CTP), the offshore Ghanaian block that includes
Department’s Office of Foreign Assets Control the Pecan oilfield. The remaining equity in the
(OFAC) does not list any Lukoil subsidiaries. It project is split between Aker Energy, the oper-
only lists Lukoil’s parent company, along with ator, with 50%; state-owned Ghana National
the address of the umbrella organisation’s head- Petroleum Corp. (GNPC), with 10%, and Fuel-
quarters in Moscow. OFAC does not identify trade (Ghana), with 2%.
any Lukoil subsidiaries as subject to sanctions, Pecan is believed to contain 450-550mn
and its materials do not include any text or refer- barrels of oil equivalent (boe) in recoverable
ences that might clarify whether the restrictions reserves. Aker Energy Ghana has said previ-
are or ever were meant to apply to the company’s ously that it intends to develop the oilfield on a
subsidiaries. stand-alone basis, without focusing on hydro-
As for the EU sanctions regime, Aker is not carbon reserves in other sections of the DWP/
likely to find clarity easily there either. When CTP block. ™

Schematic of FPSO for Phase I development work at Pecan (Image: Aker Energy)

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