Cabinet has approved a request by the Ministry of Power to sign a contract with a Nigerian company for the supply of additional gas to complement gas supply from Nigeria Gas (N-Gas) and Ghana Gas to generate electrical power. Measures are being taken to seek parliamentary approval for the transaction.
The Minister of Power, Dr Kwabena Donkor, who made this known in Tema yesterday, said the gas, in the form of liquefied natural gas (LNG) would be supplied by West Africa Gas Limited, another company that differs from the West African Gas Pipeline Company (WAPCo), Ghana’s traditional transporter of gas from Nigeria.
The efforts by the ministry to get an additional source of gas have been necessitated by N-Gas’s supply shortfall. The minister said this when he toured the Tema power enclave with journalists to assess some of the ongoing projects expected to come on stream by the end of December.
He visited the Kpone Thermal Plant, the Sunon Asogli Power Plant and the Cenpower Project, all in Tema. He also toured the five-kilometre transmission lines from inland to the sea.
The minister said the LNG which would be stored and converted to gas when needed, would be produced at the minimum capacity of 120 million standard cubic feet (mmscf).
The shortfall in the supply of gas to the country from Nigeria has contributed greatly to the power crisis. Ghana currently has installed power generation capacity of about 2,923MW, and it is likely to shoot up with additional power from the power ship and other projects. That indicated that the power problems have more to do with fuel to power the plants than generation capacity.
Although Ghana has an agreement with N-Gas for N-Gas to supply a contractual volume of 120 million mmscf of gas daily, the Volta River Authority (VRA) is unable to pay for the supply and buy light crude in case of emergency. The country’s load deficit is estimated at between 380MW and 400MW currently.
The situation has resulted in thermal plants in the Tema enclave either producing at reduced capacities or lying idle. N-Gas recently threatened to seal the gas pipeline that supplies gas to thermal plants powered by the VRA due to the VRA’s indebtedness.
Since August 2014, the VRA has received natural gas and pipeline-related transportation services totalling US$231 million through the West African Gas Pipeline Company (WAPCo).
As of October 14, 2015, the VRA had paid only US$50 million of the amount owed. Aside from the financial challenges, there are also technical constraints which halt the supply of gas from Nigeria.
Ghana is currently receiving about 110 million mmscf from Ghana Gas and about 45 million mmscf from Nigeria Gas. But Dr Donkor indicated that the natural gas was expected to power the thermal enclaves in Tema.
Payment for the LNG, he said, would be made as the company supplied the gas to the country, adding that the initiative formed part of the measures outlined to resolve the power crisis.
On the Karpowership, the minister explained that the power barges were still being quarantined in Istanbul, Turkey, for customs clearance after which it would sail to Ghana, adding that the power barges would definitely be in the country by the end of November.
The barges will be operated on heavy fuel oil and gas, he said, adding that a contract had been signed between Karpowership and the Ghana National Petroleum Corporation (GNPC) for GNPC to supply Karpowership with the heavy fuel oil.
He, however, stated that the power barges were not the only project in place to deal with the power crisis, but other projects such as the Kpone Thermal Plant, Africa and Middle East Resource Investment (AMERI) and Asogli were all expected to come on stream with about 700MW of power by the end of December.
The Karpowership is expected to give Ghana 450 MW but initially, it will give 225MW; Kpone will give 220MW but give 110 MW in December and AMERI is also expected to produce 250MW, while the Asogli Power Plant supplies 300MW.
Dr Donkor further explained that the power barges were short to medium term solutions, while the other projects were medium to long-term solutions to the power deficit.
Cenpower and other projects, he said, were also expected to come on stream in 2017. Considering the various projects in place and the use of thermal plants, the minister reiterated the need to increase tariffs to reflect production cost.
All things being equal, the minister indicated, the load-shedding exercise would come to an end by December 2015.
Payment of bills by varsity students
On issue of students paying utility bills, the minister indicated that parliament had endorsed the proposal for students to pay some of the bills.
To ensure equity for students staying in halls on campus and those in the hostels, he said it would only be fair that those in the halls paid their electricity bills.
The Chief Executive Officer of GRIDCo, Mr William Amuna, briefing the press on the preparedness of the company to receive the power barges, said 85 per cent of the work was complete.
He also said the five-kilometre transmission lines which would connect the power barges to the national gird had almost been completed, adding that the remaining work would continue when the barges arrive.
At the Kpone Thermal Plant, the Project Manager of the VRA, Mr Francis Agbanyo, said software problems and wornout components that had to be changed were the causes for the delay.