Ghana oil talks bring Shell, Chevron to deepwater block

Ghana oil talks drew Shell and Chevron into a non-binding accord as output fell to 48.25 million barrels in 2024, pressing Accra to revive investment.

South Deepwater Tano terms

The memorandum of understanding, signed Tuesday with Ghana National Petroleum Corporation, covers negotiations for rights tied to South Deepwater Tano Cape Three Points. It does not complete a license award; Shell said final terms still require further talks and relevant approvals.

Chevron confirmed the memorandum and said it is “constantly reviewing new global exploration opportunities.” The companies are entering the process as Ghana’s government reviews the legal and fiscal terms used to attract upstream petroleum capital.

Output falls from 2019 peak

Ghana’s crude production fell to 48.25 million barrels in 2024 from a peak of 71.44 million barrels in 2019, according to the U.S. International Trade Administration. That drop is the central commercial problem behind Accra’s renewed effort to bring larger operators into offshore acreage.

Energy Minister John Jinapor told an Accra energy conference this week that proposed reforms include lowering GNPC’s initial carried interest in upstream projects to 10% from 15%. That initial stake does not carry financial obligations, according to the minister’s remarks.

The government is also considering a simpler tax regime and royalties that vary by water depth. The mechanism matters for deepwater projects, where higher technical costs can make fiscal terms decisive in whether companies commit exploration and development capital.

Jubilee and TEN plans

The Shell and Chevron talks are not the only investment signal around Ghana’s offshore fields. Kosmos Energy and partners including Tullow Oil have announced new spending plans for the Jubilee and TEN fields that could fund up to 20 new wells.

Those wells would target existing producing areas rather than the South Deepwater Tano Cape Three Points block. For Ghana, the distinction matters: additional wells at known fields can support nearer-term output, while a new deepwater block would likely require a longer sequence of appraisal, licensing and development decisions.

If final license terms are agreed and approvals follow, Shell and Chevron would gain a clearer path into Ghanaian deepwater acreage. The immediate macro effect would depend on future volumes rather than the memorandum itself, while Ghana’s upstream sector would get a stronger signal that revised fiscal terms can draw global operators.

If negotiations stall, the accord would remain a framework rather than a production commitment. In that case, Ghana would rely more heavily on Jubilee and TEN investment to slow the output decline, while Shell and Chevron would preserve optionality without committing capital to the block.

If the fiscal review produces lower entry costs and differentiated royalties that operators accept, Ghana could improve competition for future offshore acreage. If the changes are delayed or viewed as insufficient, the sector’s recovery would depend on existing fields, and the global supply effect would remain tied to incremental wells rather than a broader exploration cycle.