West African Gas Pipelines have received gas from Nigeria over the past 3 years
West African Gas Pipelines have received gas from Nigeria over the past 3 years

BY: Mariilyn Badoo

In April 2015,Ghanaians woke up to the good news that the stifling power crisis which is deeming the economic fortunes of the country, would be banished into history within weeks following commencement of gas supply from the country’s Atuabo gas processing plant.

West African Gas Pipelines have received gas from Nigeria over the past 3 years
West African Gas Pipelines have received gas from Nigeria over the past 3 years
Challenges in the power sector have been attributed to the inability to procure sufficient light crude oil to bring all thermal power plants on-stream. Gas supply from Nigeria, through the West Africa Gas Pipeline has also been erratic, and disappointing to say the least.

But experts say, power is not the only use to which Ghana can put its gas. Of course the country has begun producing and supplying LPG to the domestic market and helping in the process to ease supply constraints in the gas market.

It is however an undeniable fact that, for Ghana to optimise its benefits from its gas extraction, it will need to be guided by a master plan. This realisation was made in 2008 at the first ever Ghana Oil for Development Conference held at GIMPA by the government and its development partners.

Sadly, it’s been seven years and still the Gas Master Plan is not in place. Having a ”Master Plan” will guide the uses to which Ghana puts its gas resource, and will invariably provide opportunity for interfacing agriculture with the hydrocarbon industry in order to create the necessary backward and forward linkages between the industry and the rest of the national economy.

In his inaugural address at Atuabo, in the Ellembele District of the Western Region of Ghana, where Ghana’s gas plant is sited, President John Dramani Mahama assured Ghanaians that the gas project was going to push the country’s development to greater heights, helping to stabilize the macro-economy and save the country the trouble of using hard currency to import light crude oil (LCO) to power the thermal generation units.

He described the project, as “the game changer for the national economy” and the first national effort at monetizing the country’s domestic associated natural gas from the Jubilee Fields”.

The project, he said, would not only benefit the country but also position Ghana as the majority shareholder of 45 per cent and the rest shared among the other investors.

The Atuabo plant is positioned to process more than 180,000 tonnes of liquefied petroleum gas (LPG) for domestic use, representing about 70 per cent of the national requirement of 240,000 tonnes. The delivery of 46,000 tonnes of condensates and about 15,000 tonnes of isopethain will help reduce pressure on the national currency by reducing the import of these products.

Atuabo has the capacity of producing some 120 million standard cubic feet (mscf) of gas. However the Ghana Gas Company hopes that the completion of works on Takoradi International Company (TICO) plants will enable them produce full capacity of the 120 million cubic feet of gas which will help ease the power challenges the country is facing.

The inadequate supply of gas has necessitated the use of light crude oil by the Volta River Authority (VRA) to generate power and power generation by light crude oil is typically at much higher cost than gas-fired generation.

The country spends between 20 and 30 percent of its export earnings to import crude oil and petroleum products.

With fluctuating and ever increasing prices of crude, the discovery of natural gas means that Ghana can go in for local production. If this production meets even a third of the country’s needs, it will be able to save around $350 million each year. This money could have been used in other areas of the economy. Ten companies, led by the Sinopec Inc. of China, took part in the construction of the 150 Million Metric Standard Cubic Feet project which spans eight major districts in the region – Ellembelle, Jomoro, Nzema East, Ahanta West, Mpohor, Tarkwa Nsuaem, Prestea Huni-Valley and Sekondi/Takoradi.

The same company is also lobbying to construct the second phase of the gas plant. Once again another assurance has been given that soon, a Master Plan for the country’s gas will be in sight. It is hoped that it will not be the usual lip-service but a reality this time around. Without the Master Plan great opportunities for using the gas to transform the country’s economy will be lost on us.

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