Ghana Gas, Chinese company sign agreement on construction of gas transmission line
The Ghana Gas Company Limited and Yantai Jereh Oilfield Services Group Co. Ltd of China yesterday signed a multi-million dollar project implementation agreement for an onshore natural gas transmission pipeline (NGTP) to be constructed in Ghana.
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The entire project, including the implementation phase, is estimated at $500 million.
The Chief Executive Officer of Ghana Gas, Dr George Sipa-Adjah Yankey, signed on behalf of Ghana Gas, while Mr Sun Weijie, Founder, Chairman and CEO of Yantai Jereh, signed for his company at a ceremony in Accra.
Ghana has been struggling to get enough gas to power its power generating plants since 2012, resulting in intermittent supply of power to homes and businesses.
The agreement, therefore, marks a significant milestone in the country’s quest to become energy sufficient before the last quarter of 2018.
First gas from the project is anticipated to flow in the second quarter of 2018 to power plants in Tema and Takoradi.
The gas pipeline will be fed with gas from the Jubilee, TEN and ENI projects offshore the Western Region.
Agreement
Dr Yankey expressed delight at the turn of events and disclosed that the project was the biggest ever to be run on a build, operate and transfer (BOT) basis.
He explained that the agreement represented the implementation plan of the project because the parties were still negotiating the terms of the BOT and so to avoid delays in the project and avoidable cost to the Ghana National Petroleum Corporation (GNPC), the implementation agreement had been signed for the project to commence.
He said local industry had the chance to benefit immensely from the project because the Local Content Law had catered for that.
While interacting with the media after the signing ceremony, Dr Yankey declined to mention the actual value of the project, with the reason that the figure might go down or up after the BOT agreement had been signed.
He said the Front End Engineering Design (FEED), which can be likened to a major feasibility study on the project, would be completed in three months.
The outcome of the study would serve as the basis for negotiating the actual value of the BOT, he added.
For his part, Mr Weijie said his company had 17 years’ experience in the construction of oil and gas infrastructure, adding that it was prepared to work on time and within budget.
The project
The construction phase of the project, which will take 24 months, will begin in the next six months.
The Ministry of Petroleum mandated Ghana Gas to build the pipeline.
The 24-inch, 290-kilometre onshore pipeline will pass through the Western, Central, Eastern and Greater Accra regions.
It is expected to handle a maximum capacity of 380 million standard cubic feet of gas per day (mmscfd) in phase one and up to a maximum capacity of 550 mmscfd in phase two.
Benefits
The project is expected to provide bi-directional transport of gas between the critical load centres of Takoradi and Tema and provide supply security between the two key market points.
“With 400km of pipeline between Atuabo and Tema, the facility will also provide significant mobile gas storage for strategic delivery to the downstream power plants in the event of supply outage,” Dr Yankey said in an earlier interview with the Daily Graphic.
On completion of the pipeline, Ghana Gas would have constructed a national gas infrastructure that spans about 80 per cent of the country’s coastal frontier.