Offshore Oil Revives Old Border Disputes Between Ghana And Ivory Coast
While it would be easy for casual observers to think of maritime law as an outdated fiefdom of scholars whose relevance has long since fallen off along with wooden armadas, island discoveries and cannon fire, the field has experienced a popular resurgence over the last few years.
Why, is maritime law all of a sudden extremely relevant to politicians and those conducting international business? Offshore oil.
As we profiled here on AFKInsider, at the end of August, Somalia took its grievances with Kenya over maritime borders and control of a large area of the Indian Ocean that is potentially laden with oil to the International Court of Justice.
Similar grievances on the other side of the continent in the Gulf of Guinea have recently boiled over into a request for arbitration under the United Nations Convention on the Law of the Sea by Ghana against the Ivory Coast.
This is not a new dispute. Talks between the two states over the borders go back to at least 2010 and according to Reuters, in 2013, the reverse was true, with Ivory Coast complained of Ghana encroaching on its maritime territory in the Gulf of Guinea.
After this complaint, the two countries agreed to establish a trans-border committee to determine boundaries while still maintaining friendly relations between neighbors. Ghana’s request for arbitration comes after ten bilateral meetings failed to reach a mutually agreeable solution.
The Ivory Coast is required to respond to Ghana’s allegations by the Convention, which has been signed and ratified by both parties.
According to the rules for arbitration, “Absence of a party or failure of a party to defend its case shall not constitute a bar to the proceedings.”
Thus, if Ivory Coast opts against defending its claims, the arbitral panel can move on without it or, as was the case in a recent Chinese arbitration under the convention, a representative can be appointed without its consent.
This appears to be moot, as The Ivory Coast has responded by saying that it will take the dispute before a “competent jurisdiction” but declined to say more for the time being.
The UN Convention on the Law of the Sea provides for a number of different options for arbitration including the International Tribunal for the Law of the Sea in Hamburg, the International Court of Justice in The Haguer ad hoc tribunals, constituted solely for such arbitrations or specialized arbitral tribunals.
States, upon signing or ratification, are able to choose a preferred avenue for such arbitration, however, according to the UN’s official list of convention declarations, neither state has done so.
Unfortunately, arbitration filings are not immediately made public, so it is impossible to evaluate each side’s claim to the disputed territory. As soon as such claims are made public we will revisit the issue.
Much is at stake for both countries. Ghana, widely considered a West African success story, is hugely reliant on resource revenue.
According to the World Bank, nearly one fifth of the country’s GDP was a product of resource rents over the last two years for which data is available. The Ivory Coast relied on such revenues for 9% of its GDP over the last two years, insignificant when compared to Ghana but very high internationally.
While these numbers include diverse natural resources, oil is considered a major part of the future of both countries.
In an attempt to ease potential fears of companies involved in petroleum exploitation, Ghana’s Attorney General, Marrieta Brew Appiah-Oppong has said that oil companies can continue to operate on the disputed water during the process, which could take several years.
This is important, not only to ease the fears of investors, but also due to the sheer success of Tullow Oil in the area. The London-based company is the largest investor in the disputed Tweneboa, Enyenra and Ntomme cluster, known by the acronym TEN.
Tullow discovered oil in the cluster in 2007 and, according to Reuters, began producing oil in “record time,” by 2010. The discovery continues to expand, with recent Bloomberg predictions that production will double by 2017. This will be accompanied by $20 billion of investment in the offshore oil fields over the next ten years.
As the price of oil goes up, so too will the cost-efficiency of offshore drilling operations. In addition to standard offshore operations, deep water and other methods will become increasingly profitable and, therefore, increasingly viable.
There is no doubt such disputes will continue throughout the globe between states with competing claims to offshore areas. In short, maritime law may see a resurgence between countries looking to control offshore oil. Somalia and Kenya, along with Ghana and the Ivory Coast, are just the start.
Andrew Friedman is a human rights attorney and freelance consultant who works and writes on legal reform and constitutional law with an emphasis on Africa. He can be reached via email at firstname.lastname@example.org or via twitter @AndrewBFriedman.