Exxon Mobil Corp.’s agreed purchase of the Ghana oil assets of Kosmos Energy LLC may be thwarted by the West African country’s state-owned energy company.

Ghana National Petroleum Corp. is “still in discussions” with Kosmos to acquire the stake, Thomas Manu, its director of exploration and production, said in a telephone interview today. “GNPC will acquire the stake and then consider proposals from other companies” with a view to taking on partners.

Closely held Kosmos, backed by Blackstone Group LP and Warburg Pincus LLC, said yesterday it agreed to sell its Ghana properties to Irving, Texas-based Exxon Mobil. The deal is estimated by a person familiar with the sale to be worth at least $4 billion.

“If the Ghanaian government wants to step in and increase its share I would assume they have the authority to do this,” Oswald Clint, an analyst at Sanford C. Bernstein & Co. in London, said by phone. “I would say this deal is still not sealed.”

Ghana is set to become one of Africa’s newest oil exporters in late 2010 when production begins at the offshore Jubilee field, which was discovered in June 2007 and has potential resources of as many as 1.8 billion barrels, according to Tullow Oil Plc, its operator.

‘Fair Price’

GNPC, which oversees Ghana’s nascent oil and gas industry, would acquire Kosmos’s holding “at a fair price,” Manu said today. “We have been talking to so many oil companies, we don’t want to single out any one,” he said, referring to possible partners.

China National Offshore Oil Corp. is in talks with GNPC on making a bid for Kosmos’s stake in the offshore Jubilee field, the Wall Street Journal said yesterday, citing unidentified people.

Xiao Zongwei, a spokesman for Cnooc Ltd., the listed arm of state-controlled China National Offshore Oil, didn’t answer calls this morning to his office and mobile telephone.

“It’s completely reasonable that Cnooc could make a counter offer to match any bid from Exxon for the stake in the Jubilee field,” said Gordon Kwan, head of regional energy research in Hong Kong at Mirae Asset Securities. “It has $10 billion in cash on its books and virtually no debt.”

The agreement with Exxon Mobil is binding, Kosmos Chief Financial Officer Greg Dunlevy said in an e-mail yesterday. Exxon Mobil spokesman Patrick McGinn said he wasn’t immediately able to comment.

Companies with stakes in Jubilee include London-based Tullow; Anadarko Petroleum Corp., based near Houston; Sabre Oil & Gas; EO Group; and GNPC.

‘Pre-emptive Rights’

All of the partners in the Jubilee oilfield “have pre- emptive rights,” Tullow’s Chief Financial Officer Ian Springett said July 8.

The purchase would give Exxon Mobil a 23.49 percent stake in Jubilee, as well as nearby prospects in Ghana’s Gulf of Guinea waters. After discoveries in the late 1990s and early 2000s made Africa the top source of crude for Exxon Mobil, the company’s exploration efforts stumbled the past two years.

The Jubilee stake will add about 28,000 barrels of daily oil production, the equivalent of 1.2 percent of Exxon Mobil’s worldwide crude output in the second quarter. The company may not meet its 2 percent target for production growth this year, Senior Vice President Mark Albers told analysts at a conference last month.

Exxon Mobil drilled 11 net exploration wells in Africa in 2007 and 2008, six of which turned up dry, according to a company filing. Even so, Africa is one of the cheapest places in the world for the company to pump oil. With an average production cost of $6.66 per barrel, Exxon Mobil’s African crude is less than half the cost of the company’s Canadian output.

Exxon Mobil already operates oil fields in other nations that rim the Gulf of Guinea, including Nigeria and Equatorial Guinea, as well as onshore wells in Chad. The deal with Dallas- based Kosmos would mark the company’s entry to Ghana.

Africa is also home to 21 percent of Exxon Mobil’s worldwide crude reserves. The continent accounts for 27 percent of the company’s global crude production.

source: bloomberg

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