A former Chief Executive Officer of the Ghana National Petroleum Corporation (GNPC), Mr Alex Mould, has raised concerns over the decision of the oil exploration firm, Tullow Oil, to cut down on its workforce in one of its core producing countries.
Mr Mould explained that while the decision to cut down its costs following its challenges in recent times was understandable, the decision to lay off close to 30 per cent of workers in Ghana where it has two producing fields was worrying.
Speaking in an interview after the Graphic Business/Stanbic Bank Breakfast meeting in Accra last Tuesday, Mr Mould charged the Petroleum Commission to further engage Tullow as this had implications on revenues due the country.
“Tullow had to react to the market by cutting cost. If you are cutting cost in any business, you cut it in the non-core areas.
“My concern is, why they are cutting cost in their only revenue generating fields which are in Ghana? And why are they transferring most of their support services from Ghana to the United Kingdom?” he quizzed.
Mr Mould also mentioned that a careful look at the situation showed that the company was actually employing foreigners in the UK to carry out tasks that Ghanaians could be doing in the country.
“Tullow has reduced the workforce in other areas but my concern is why would you reduce the workforce by 30 per cent in your only producing country.
“I charge government to have a conversation with Tullow. The Petroleum Commission should do their work and come up with why they are allowing Tullow to move jobs of workers in Ghana, including drivers, to the UK,” he said.
In the latter part of last year, the oil exploration company had its stock price plummeting to an all-time low on the stock market.
News of the resignation of Tullow Oil Plc’s Chief Executive Officer, Mr Paul McDade, and Exploration Director, Mr Angus McCoss, also contributed further to the shares of the company tumbling.
Mr Mould explained that Tullow Oil’s problems mainly had to do with the stocks tumbling.
“Tullow’s problem has to do more with its stock price plummeting from a high of US$20 dollars when the company did an Initial Public Offer (IPO) to the current price of less than a US dollar.
“This is because Tullow did not provide information to market analysts on the quality of their oil from Guyana and also Tullow did not disclose why its production had dwindled in Ghana,” he said.
Ghana production challenges
In 2019, Tullow Oil, which is the lead operator of the Jubilee Field, reported that oil production at the Jubilee Field was below the set target of 170,000 barrels due to reduced offtake of gas.
The reduction in the offtake of gas meant that significant volumes of gas had to be re-injected into the reservoir, a practice that can damage the reservoir and reduce oil production over time.