The Institute of Economic Affairs (IEA) is urging Ghana’s government to subject the recent agreement with Tullow Oil extending its petroleum licences for the West Cape Three Points and Deepwater Tano blocks beyond 2036 to parliamentary scrutiny, citing potential constitutional implications.
The original licences granted to Tullow Oil were endorsed by Parliament with a set expiration date of 2036. According to the IEA, altering these terms without legislative input undermines transparency and public interest, particularly given the economic significance of Ghana’s upstream oil sector.
The IEA insists that this is not a bureaucratic formality but a constitutional safeguard, ensuring that the people’s elected representatives evaluate any revisions to major contracts involving the country’s natural wealth.
Although the new understanding between the government and Tullow Oil would extend the oil giant’s production operations through 2040, the IEA insists that such an agreement cannot bypass Parliament. The Institute argues that extending the timeline of a contract initially ratified by the legislature alters its original terms and therefore requires formal re-ratification.
At an IEA roundtable on natural resource governance, lawyer Victor Anku-Tsede cited Ghana’s 2017 Supreme Court ruling in Banful and Another v. Attorney General to support the position that any form of agreement whether titled a memorandum of understanding (MoU), addendum, or otherwise must follow the path of constitutional oversight when it impacts national resources.
“The nomenclature of an agreement, whether called an MoU or understanding, does not remove its legal character,” Anku-Tsede noted, cautioning that bypassing Parliament could erode accountability in Ghana’s resource governance framework.
Industry observers say the government’s engagement with Parliament on the matter could determine not only the legal strength of the extension but also investor sentiment regarding regulatory consistency in Ghana’s extractive sector.
