ACCRA, April 6 - Ghana expects new natural gas supplies arriving this year to help ease a power crunch that has triggered blackouts and raised electricity costs in one of West Africa's premier economies.
Some 130 million cubic feet per day (cfd) of the power plant fuel are expected this year from the newly restarted West Africa Gas Pipeline and the offshore Jubilee field that is due to start up in the fourth quarter.
The new supplies in the continent's No. 2 gold miner and world's second biggest cocoa producer are expected to significantly reduce the cost of generation and make power affordable for both businesses and domestic consumers, Deputy Information Minister Samuel Okudjeto told Reuters on Tuesday.
"It is also an incentive for more privately-funded construction to boost national capacity to power bulk users, such as Valco," he said of the country's sole aluminum refinery, which was idled in January 2009.
The West Africa Gas Pipeline Co restarted flows of Nigerian gas to Ghana on March 20 following a nearly one-year outage caused by vandalism, an official said on Tuesday.
"The volume of gas flowing is approximately 30 million standard cubic feet per day, which is enough to generate 110 megawatts," said Jack Derickson, the project's director.
He said the resumption of flows on the line would allow power plants in Ghana's western port city of Takoradi to switch from the costlier light crude they had been using to produce electricity since the line shut down last May.
The 678 km (420 mile) pipeline was originally put in service in 2008 to transport gas from Nigeria's oilfields to Benin, Togo, and Ghana to help ease chronic power shortages seen as a hindrance to the region's development.
But flows on the line, built to carry as much as 200 million cfd, were suspended in May due to vandalism in Nigeria, where energy infrastructure is routinely targeted by rebels angered over what they say is the unequal distribution of oil wealth.
ADDITIONAL SUPPLY
Ghana expects an additional up to 100 million cfd of gas supply when Tullow Oil (TLW.L) begins crude oil production from Jubilee in the fourth quarter of this year, an official at Ghana National Petroleum Corporation said.
"We are expecting 70-100 million cubic feet of gas from the field during startup," Thomas Manu, GNPC's director of operations said, adding the $1 billion project to get the gas ashore was on track for year-end.
While the gas could help boost output and lower costs, Ghana is still struggling with limited generation capacity.
The country produces about 1,480 megawatts (MW) out of its installed capacity of 2,000 MW as equipment ages, according to the state power utility Gridco, which is planning to spend $1.2 billion to raise capacity to 5,000 MW by 2015.
"Current power demand growth is seven to 10 percent (per year). This implies doubling infrastructure every 10 years to satisfy demand," Gridco spokesman Albert Quainoo said.
The West Africa Pipeline could also eventually raise gas flows to 450 million cfd by building additional compressor stations if enough gas-fired generation capacity is constructed to use it, West Africa Gas Pipeline Co has said.
U.S. oil major Chevron (CVX.N) holds a 36.7 percent stake in the West African Gas Pipeline Co. Other shareholders include the Nigerian National Petroleum Corp and Royal Dutch Shell
Some 130 million cubic feet per day (cfd) of the power plant fuel are expected this year from the newly restarted West Africa Gas Pipeline and the offshore Jubilee field that is due to start up in the fourth quarter.
The new supplies in the continent's No. 2 gold miner and world's second biggest cocoa producer are expected to significantly reduce the cost of generation and make power affordable for both businesses and domestic consumers, Deputy Information Minister Samuel Okudjeto told Reuters on Tuesday.
"It is also an incentive for more privately-funded construction to boost national capacity to power bulk users, such as Valco," he said of the country's sole aluminum refinery, which was idled in January 2009.
The West Africa Gas Pipeline Co restarted flows of Nigerian gas to Ghana on March 20 following a nearly one-year outage caused by vandalism, an official said on Tuesday.
"The volume of gas flowing is approximately 30 million standard cubic feet per day, which is enough to generate 110 megawatts," said Jack Derickson, the project's director.
He said the resumption of flows on the line would allow power plants in Ghana's western port city of Takoradi to switch from the costlier light crude they had been using to produce electricity since the line shut down last May.
The 678 km (420 mile) pipeline was originally put in service in 2008 to transport gas from Nigeria's oilfields to Benin, Togo, and Ghana to help ease chronic power shortages seen as a hindrance to the region's development.
But flows on the line, built to carry as much as 200 million cfd, were suspended in May due to vandalism in Nigeria, where energy infrastructure is routinely targeted by rebels angered over what they say is the unequal distribution of oil wealth.
ADDITIONAL SUPPLY
Ghana expects an additional up to 100 million cfd of gas supply when Tullow Oil (TLW.L) begins crude oil production from Jubilee in the fourth quarter of this year, an official at Ghana National Petroleum Corporation said.
"We are expecting 70-100 million cubic feet of gas from the field during startup," Thomas Manu, GNPC's director of operations said, adding the $1 billion project to get the gas ashore was on track for year-end.
While the gas could help boost output and lower costs, Ghana is still struggling with limited generation capacity.
The country produces about 1,480 megawatts (MW) out of its installed capacity of 2,000 MW as equipment ages, according to the state power utility Gridco, which is planning to spend $1.2 billion to raise capacity to 5,000 MW by 2015.
"Current power demand growth is seven to 10 percent (per year). This implies doubling infrastructure every 10 years to satisfy demand," Gridco spokesman Albert Quainoo said.
The West Africa Pipeline could also eventually raise gas flows to 450 million cfd by building additional compressor stations if enough gas-fired generation capacity is constructed to use it, West Africa Gas Pipeline Co has said.
U.S. oil major Chevron (CVX.N) holds a 36.7 percent stake in the West African Gas Pipeline Co. Other shareholders include the Nigerian National Petroleum Corp and Royal Dutch Shell
