By Adeniyi Adeoloye
Ghana’s upstream industry is back in the spotlight. So far in September 2026, the country has signed three upstream Memoranda of Understanding (MoUs) with international oil companies (IOCs): Shell and Chevron, and ENI. This is particularly important because, in Ghana’s upstream landscape, an MoU mostly precedes a Petroleum Agreement (PA), subsequent work programmes and, ultimately, barrels.
Against this backdrop, there is no doubt about the belief that this new wave of MOUs holds the key for production revival, if the signed understandings translate into PAs, work programmes encompassing data acquisition and drilling, commercial discoveries, and eventually first oil. The optimism is understandable, given the deep pockets and technical credentials of the majors involved. Then again, this would not be Ghana’s first rodeo with MoUs.
Since Ghana upstream sector emerged with the start of production from the Jubilee field in 2010, MoUs have featured in the entry of oil and gas companies into the country’s upstream industry. The record of these understandings since then provides a basis to assess how previous MoUs have translated into Petroleum Agreements (PAs), exploration activity, discoveries and barrels, and whether the enthusiasm surrounding the current wave can go beyond expectations and materialise into production.
Ghana’s Petroleum (Exploration and Production) Act, 2016 (Act 919), provides the legal basis for the award of a PA. Under the Act, a PA can be awarded through “an open, transparent and competitive public tender process” or by “direct negotiations”. Regardless of the mechanism, it is mandatory that a PA is ratified by Ghana’s parliament to become effective.
This distinction is important because an MoU is not a PA, and does confer the same rights under the law. Unlike a PA which grants the holder the right to “engage in the exploration, development and production of petroleum”, an MOU is only a step in a much longer journey that may lead to petroleum agreement, exploration activity, and eventual first oil.
September 2026’s MoU signings covers three blocks across Ghana offshore basins. Shell and Chevron signed an MoU with Ghana National Petroleum Corporation (GNPC) in the South Deepwater Tano block. ENI, in partnership with Vitol Upstream Tano Ltd, also inked two MoUs for GH WB_3 and GH_W8 blocks, offshore Tano basin. The Shell-Chevron MoU relates to an acreage previously held by AGM Petroleum and is distinguished by an existing discovery, Nyankom, rather than being a pure frontier block. The block was relinquished in 2023.
While the three MoUs signed in September 2026 leave room for confidence, particularly given the credentials of the companies involved, recent experience suggests caution. One of the two blocks in the ENI – Vitol signed MoU, GH-WB3, was previously awarded to the same partners in 2019 following Ghana’s 2018 licensing round. An MoU for block GH_WB_3 was signed in 2019, but it never progressed into a PA and eventually lapsed in 2023. The expiration of ENI’s 2019 MOU is particularly noteworthy given that ENI is already an established producer in Ghana, with net equity production of 40,000Barrels of Oil Equivalent per day (BOEPD). Yet the operational record and in-country presence did not prevent the 2019 MoU from expiring without progressing into a PA. Perhaps ENI could not reach an amicable understanding with authorities in Ghana then?
Even more telling is the case of ExxonMobil. In 2015, Ghana signed an MOU with the American major for the Deepwater Cape Three Points block. Unlike companies seeking to accumulate paper barrels or warehouse acreage, ExxonMobil’s operational record and global portfolio gave credibility that the MoU could lead to significant upstream activity. The Exxon MOU morphed to a PA in 2018, and secured parliamentary ratification in 2019. It is important to note that the ExxonMobil MoU was signed before the Petroleum (Exploration and Production) Act 2016 came into force. According to the Petroleum Agreement, this complicated the negotiations before all parties eventually reached a compromise.
Under the terms of agreement, ExxonMobil committed to undertake a minimum work programme which include to “acquire, process and interpret 2,222 square kilometres of three dimensional (3D) seismic data; drill one (1) exploration well (optional)” in the initial exploration period (two and half years from the date of the agreement). Alongside a minimum capital expense of $20Million. Yet the PA did not live to see the subsequent commitments beyond the initial phase as the block was relinquished in 2021. No exploration well was drilled nor subsequent programmes attained. Exxon held 80% interest in the block, with GNPC holding 15%, and Ghana Oil Company Limited the remaining 5%. In other words, despite progressing from MoU to PA, the acreage did not translate to barrels or production.
The above cases have shown that neither financially and technically heeled companies such as ExxonMobil and ENI, nor an independent player like Norway AGM Petroleum, were able to beat the odds. AGM Petroleum’s case is particularly interesting given that it had made a discovery. The question, perhaps best answered by industry insiders or parties to the agreement, is what could have led to AGM Petroleum and ExxonMobil to walk away? Because in ENI’s case, the issue was different, as the MoU it signed in 2019 simply expired without progressing into PA.
If there is anything to learn from the past, it is that these MoUs represent opportunities rather than guaranteed barrels or production. Their real significance would be determined on what follows, that is: the signing of Petroleum Agreements, execution of work programmes, exploration activity, appraisal, and ultimately first oil.
Expectedly, the current wave of MoUs offers room for hope. However, recent records suggests that eventual barrels would come from work commitments and execution that follows the MOU, and not from the announcement itself.
