Oil contracts cancelled over Coronavirus

The coronavirus has led to the cancellation of some petroleum contracts, the Chief Executive Officer of the National Petroleum Commission, Egbert Faibille Jnr., has disclosed.

Egbert Faibille also indicated that the impact of the COVID-19 induced contract cancellation affected local jobs in the oil and gas sector.

“The consequential effect of the cancellation of contracts amidst the already reduced workforce in the industry resulted in lay-offs of both expatriate and local personnel. Over 500 Ghanaian workers in the industry are expected to lose their jobs as a result of the pandemic.”

“Local businesses have been significantly hit by the pandemic. The pre-COVID-19 outlook of the industry resulted in considerable investment in infrastructure, personnel and technologies in anticipation of participation in major projects.

‘Indeed, over 98 contracts worth over $389 million were awarded by Aker Energy, AGM, Eni, GOSCO and Springfield from Q4 2019-Q1 2020.

“The cancellation of these contracts such as the 5-year Maersk Drilling contract which was terminated in June 2020 together with associated sub-contracts would have a devastating toll on local businesses,” he said while briefing the Western Regional House of Chiefs on the petroleum sector.

Source: Laud Business