On Saturday, the 23rd of September, 2017, the International Tribunal of the Law of the Sea (ITLOS) ruled in favour of Ghana in the maritime boundary dispute that Ghana had brought to the Tribunal, against the Republic of Cote d’Ivoire.
The Tribunal dismissed Cote d’Ivoire’s claims that Ghana infringed on its rights by exploring and producing oil from a section of the disputed area, and set the new boundary at a position, that reports say, is close to what Ghana wanted.
History of the Dispute
The dispute began in 2007 when Ghana discovered oil and gas in commercial quantities in the Jubilee Fields. Cote d’Ivoire began to lay claim to portions of West Cape Three Points. Those claims intensified in 2010 after Abidjan petitioned the United Nations to complete the maritime boundary Cote d’Ivoire shares with Ghana.
Both countries had a series of meetings to try to resolve the meeting. No concrete solution came out of these meetings, and in 2014, Ghana petitioned the Tribunal to resolve the dispute. In 2015, the ITLOS placed a moratorium on further exploration and drilling in the disputed area. This affected some planned activities in the area. Tullow Oil, operators of the TEN fields had to suspend the planned drilling of a number of wells in the TEN fields.
Cost of the Dispute
In 2015, the cost of contesting the boundary at the ITLOS cost about $1.81 million. That figure rose to about $2.83 million in 2016. Tullow shares fell in 2015 at the height of the dispute. At the beginning of this year, they lost about $200 million off their market value due to fears over the possible result of the dispute.
Impact of the Dispute
Tullow Oil is expected to begin drilling wells again in the West Cape Three Points area to boost production in the TEN fields. Analysts also say this ruling will help improve Ghana’s economy. There has, however, been a relative lack of fanfare in the aftermath of the ruling. It seems the promise that the discovery of oil brought in 2007 has since been unfulfilled. There have been a lot of discoveries since that first one but each one is met with even less fanfare than the last one among the Ghanaian public.
The ITLOS ruling and recent comments by the President as to how to the free SHS policy will be funded may help to bring a bit of spotlight back to oil production in Ghana. 10 years after the first discovery of the black gold, it is difficult to state how much the average Ghanaian has benefited from the discovery.
At the launch of the policy, the President, Nana Akufo-Addo intimated that the policy will be funded with proceeds from the country’s natural resources, mainly revenues from oil and other minerals. This is a laudable idea if it can be implemented. While politicians, economists and policy analysts may refer to percentage increases in the growth of the economy, the average Ghanaian can only observe the impact of Ghana’s oil if they directly benefit from it. It is therefore imperative that the President’s promise is fulfilled.