Ghana to use local natural gas to fuel new thermal power generation projects

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With local output fuelling new thermal power generation projects, natural gas production and distribution is crucial to efforts to reduce power shortages. As projected in the 2015 Gas Master Plan and the 2016 energy outlook published by the Energy Commission, power provision is expected to constitute over 80% of total gas demand from 2015 to 2040. To support the processing and transportation of new supplies from gas reserves, infrastructure developments are continuing under the supervision of the Ghana National Gas Company (Ghana Gas), the state-owned agency responsible for building and operating the government’s infrastructure for gathering, processing, transporting and marketing natural gas.

Domestic Gas Availability

Until the first domestic discovery of offshore natural gas in the Jubilee field in 2007, gas was received primarily from nearby Nigeria through the West African Gas Pipeline, the first such pipeline in sub-Saharan Africa. However, severe supply disruptions in 2012 and again in 2016 forced Ghana to import expensive heavy fuels to supply its combined-cycle power plants, which contributed to a sharp increase in the deficit.

To mitigate the risks associated with relying on foreign feedstock, three domestic offshore gas fields are expected to supply the country’s natural gas needs in the coming years: the Jubilee field, with an estimated 490bn standard cu feet (scf) of associated gas; the Tweneboa, Enyenra and Ntomme (TEN) field, with 360bn scf of associated gas; and the Sankofa field, with 1.1trn scf non-associated gas. It is also estimated that the Mahogany and Teak oil and gas condensate discoveries in the West Cape Three Points Block contain total reserves of 120bn scf, intended to expand field production and increase commercial output. Gas output will be processed at Ghana’s first processing plant, the Atuabo Gas Plant, which commenced operations in 2014. It is linked to the western city of Aboadze and powers the Takoradi Thermal Power Station.

New Pipeline

After reviving a previous agreement that was initiated in 2016, local press confirmed a 15-year pipeline implementation contract with Chinese oilfield services company Jereh Group in April 2017. The $500m build-operate-transfer development entails the construction of a 290-km onshore pipeline from Takoradi to Tema, which would allow for the movement of natural gas resources that are generated in the west to be transported to the concentration of industrial centres in the east of the country, in addition to servicing the coastal regions in between. The line will include several gas distribution stations, with the first phase including the construction of stations in Takoradi, Cape Coast, Winneba, Nsawam and Tema. Jereh Group is anticipated to start construction activities imminently, though this had not yet happened as of late 2017. Once the pipeline is completed, the group will charge transportation fees based on volumes of transferred gas over 15 years, after which the Ghanaian government will take ownership of the pipeline.

Takoradi Developments

Natural gas infrastructure has been getting upgrades elsewhere as well. For instance, the primary hydrocarbons maritime facility at Takoradi Port received several key gas-related developments in 2017. Meanwhile, in April 2017 South African company Murray and Roberts completed construction of a 13.5m-litre marine gas oil storage facility – the largest in the country to date. The $15m project was financed by Ghana Oil Company with support from regional banks, and will dispatch products to upstream vessels docked at the port.

As new gas projects come on-line and the surrounding transport infrastructure is further established, added industries will benefit from stable power provision. Speaking about the upcoming gas projects, Henry Akwaboah, managing director at Engen Ghana, told OBG, “If the gas pipeline is working you, will have stable electricity, which in turn leads to manufacturing activities, which has an impact on the overall economy.”

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The Report: Ghana 2018

Energy & Utilities chapter from The Report: Ghana 2018

The Report: Ghana 2018

The Report

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