Vanco Oil Find – Another EO Handiwork

*Ibrahim Tanko*

Ghanaians are slated to be swimming in oil soon. Following the discovery of the Jubilee field by Kosmos Energy which substantially reduced the risk formerly associated to the Tano Basin as “exploration graveyard”, many global exploration companies are now seriously reassessing their understanding of the geology of offshore Ghana. The recent announcement by Vanco Oil about the discovery of oil in the Tano Basin is yet another strong evidence that as a consequence of Kosmos’ discovery in 2007, all the other companies in the basin are encouraged to explore for prospect. That means in a few months, when oil-producing countries are mentioned, Ghana’s name would be right there with the Angolas, the Nigerias, the Equitorial Guineas and so on. As refreshing as that sounds, contextualizing these new discoveries behind all these African countries against Ghana’s leadership reputation on the continent suggests a growth regression that cannot elate anyone. More so if you consider the fact that the one private sector entity most responsible for our current oil fortunes is also the most vilified company in our nation’s history. Did you know that Vanco was led to Ghana by the duo who eventually became the EO Group?

The story has been told many folds, but it must be told again. At the turn of the century, GNPC under the Rawlings administration had tried to get reputable oil companies to come to Ghana but to no avail. A combination of factors played a role in this frustration. First, the government’s policies surrounding oil exploration was not business-friendly especially considering that Ghana had no history of oil discoveries. Second, the low oil prices at that time made it an unwise investment considering the staggering required capital and the low probability of an oil find in what had become a “graveyard.” Third, the requisite technology had not advanced enough to explore for oil in the deep seas, and if one could find the technology, the cost involved was prohibitive. Last but not the least, GNPC under the management of Tsatsu Tsikata lacked the vision and tenacity to attract exploration companies of repute to explore our offshore prospects; instead, he was misguided by adventuring into businesss prepositions he had no clue in. The last time I investigated, that man was supposed to be a great lawyer but not an oil man, yet you would be hard pressed to point at any significant accomplishment of his in his own great profession of law. Could it just be that his apparent disdain for E.O. Group is simply a matter of jealousy for having failed to do what these two distinguished Ghanaians have accomplished?

When the NPP assumed office in 2001, it made oil discovery a national priority. Ghanaians in the Disapora were actively encouraged to source for oil companies, a focus that made Houston a frequent destination for energy sector officials. It was during such trips that George met with Mr. Van Dyke, CEO of Vanco Energy. Although Owusu would eventually lead Vanco to Ghana to solicit for an oil block, the two parties could not become parties to a Petroleum agreement because Owusu and Edusei had not yet formed a company. As a result, Vanco ended up securing a large, in fact, the largest block of all the companies that were in Ghana at the time, without EO involvement. For a duo that has been dubbed “Kufuor’s Boys,” how could it happen that they led a foreign company to Ghana, and yet that company secured an oil block without their involvement?

Vanco secured its Petroleum Agreement (PA) for the large block in August of 2002. George Owusu and Dr. Kwame Bawuah-Edusei quickly reorganized and formed the EO group to start searching for other oil companies right away. Three years later, GNPC was growing impatient with Vanco for “sitting” on its block. Word on the street was that Vanco merely came to secure the block and went around looking to sell it to a more serious explorer. Who could blame them? Why not have someone else invest the money to find oil in a known “graveyard?”

Meanwhile in 2003, EO had succeeded in convincing yet another Texas-based company to take a chance on Ghana. That is how Kosmos came to Ghana and secured a PA in July of 2004. Three years later in 2007, as Kosmos and the Ghana government proudly announced to the world that Ghana has discovered oil in commercial quantities, Vanco had yet to lift a finger. In fact, GNPC took back a portion of Vanco’s block due to inaction on the oil company’s part. But alas, three years later, Vanco now discovers oil.

Let’s do a double-take on the timeline: Owusu and Edusei lead Vanco to Ghana in early 2002. Vanco secures a block in August of 2002 without Owusu and Edusei’s involvement even though they led them to Ghana. This duo reorganizes and forms The EO Group and brings Kosmos Energy to Ghana in late 2003. Kosmos, EO, and Ghana sign a PA in July of 2004. Kosmos discovers oil in mid 2007. Vanco then gets serious and discovers oil three years later. Is it a stretch to suggest that Kosmos’ oil find may have lit the fire under Vanco’s feet to get serious about exploring its block? And if that is a fair suggestion, is it not also fair to credit EO for Vanco’s oil find considering all of the above?

If you do not agree with the immediately preceding premise, then may be the following would not make sense to you either. There is an old adage to the effect that if you could not thank your in-law for giving you a bride, you do not compound that lack of gratitude by stealing from him. But that is precisely what we as a nation are doing to the duo called the EO Group. While many of us were content with Ghana struggling along with Gold, Cocoa, and minute levels several other minerals, this group, based on available data at the time at GNPC, decided to gamble literally everything they had accomplished in their combined six decades of life in the United States on the slimmest of chances that oil can be found in Ghana. Because they took that chance, Ghana has now become a commercial oil destination.

May be others could have brought companies to Ghana to successfully explore for oil if the EO Group had not taken the initiative. May be others would have succeeded in securing our Independence from colonialism had Kwame Nkrumah not decided that a colonized Ghana was unacceptable. The fact remains that these pioneers took the initiative and succeeded. So why would a government that is now betting all its success on an oil discovery also spend more than one year fishing for something to discredit the very people through whose efforts that oil find became a reality in the first place? *If you could not thank your in-law for giving you a bride, you do not compound that lack of gratitude by stealing from him. If we cannot appreciate the EO Group for giving us oil, we must not compound our lack of gratitude by vilifying them.*

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