Ghana plans offshore terminal for imported LNG to drive electricity production

GHANA plans to build a floating liquefied natural gas (LNG) terminal off its Atlantic Ocean coast to receive imported gas that would be used to produce up to 1,500MW of electricity by 2016, a senior energy official said in Nairobi yesterday.

Ghana, which is the secondlargest gold producer in Africa and is also ranked the number two cocoa grower globally, says its push to expand industrial production has been constrained by an energy deficit that has seen manufacturing costs soar.

The West African country’s floating LNG terminal will have the capacity for up to 450-million cubic feet per day of gas, which will then be used to drive turbines. The country of 25-million people generates most of its 2,814MW of electricity from hydropower dams, the rest from thermal sources, while a small portion is solar power. Ghana’s power demand stands at about 1,750MW and is forecast to nearly double to 3,300MW by 2020.

Kofi Ellis, director of planning and business development at the state-run power utility Volta River Authority, said a feasibility study would be done by year-end and the next eight months would be spent on raising funds. The cost of the project would be determined after the feasibility study.

The project itself would then take 12 months to complete, and be ready for operation in 2016.

“Most of our power plants are dual-fired — they are either gas or crude,” Mr Ellis said on the sidelines of the East African power conference in Kenya.

“So if for any reason the gas project delays, we will run it on light crude oil,” he said.

Ghana had already produced some electricity using natural gas from neighbouring oil-producer Nigeria via a pipeline, but this supply fluctuated depending on Nigeria’s demand for power production, Mr Ellis said.

Plans were afoot to link the power transmission system in Ghana to all the countries in West Africa, with the aim of having a power pool.

West African countries signed the West African Power Pool agreement in October 2000. The agreement was to develop facilities for energy production in each country and then interconnect their respective national grid to boost the supply of power.

The Ghanaian government has also attracted investment in the energy sector and has raised about $4bn to help increase electricity generation with the help of private companies. This will further aid the country to meet its rising demand, which is growing at a compound annual growth rate of 8%.

Ghana is hoping that by 2015 it will become a major exporter of electricity to West Africa, as the country shifts to gas-based power generation in its thermal plants.

Mr Ellis said Ghana would rent a floating storage and regassification vessel to transport gas from producers in the region.

“It’s always good to have liquefied gas on a long-term supply basis. We have spoken to Angola, we have spoken to Mozambique, we have spoken to Nigeria.”

These countries are the continent’s other big oil and natural gas producers.

Mr Ellis said Ghana would also source natural gas from the US or the Middle East, but would first start closer to home.