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Govt signs $6bn Sankofa gas agreement

  • SOURCE: | qwesa2big
  • John-Dramani-Mahama

    The Aboadze Thermal Plant will today receive its first gas from the Atuabo Gas Processing Plant. The 30 million standard cubic feet (scf) of gas can be used to generate 125MW of power to shore up the country’s energy needs.

    The 110-kilometre gas pipeline from Atuabo to Aboadze has been packed with gas awaiting clearance from the Energy Commission (EC) and the Petroleum Commission (PC) to enable the valve connecting the plant at Aboadze to be opened.


    The Director in charge of Technical Operations at the Ghana Gas Company (Ghana Gas), Dr Ben Asante, told the Daily Graphic yesterday that the flow of gas to the Aboadze Plant was part of the pre-commissioning stage.

    After two weeks of testing its systems, and with the pipeline reaching its maximum peak with gas, he said, Ghana Gas thought it necessary to initiate the pre-commissioning process, instead of flaring the gas.

    He was hopeful that the regulatory agencies would grant the permit for the valve connecting the Aboadze Thermal Plant to receive its first gas from the Atuabo Gas Processing Plant.

    According to him, the Volta River Authority (VRA) had assessed the quality of the gas and given its approval as the type required for the thermal plant.

    He indicated that the 30 million scf of gas would be increased to 60 million by next week.

    Dr Asante said the flow of gas to the Aboadze Thermal Plant was not yet the beginning of commercial gas flow and urged Ghanaians to remain calm while the processes were followed.

    Cape Three Points

    Meanwhile, the government has concluded negotiations with ENI/Vitol Exploration, operators of the offshore Cape Three Points (OCTP) block, to start exploration for the production of oil and gas.

    The government negotiating team, made up of officials of the Ministry of Energy and Petroleum, the Ministry of Finance and the Ghana National Petroleum Company (GNPC), and ENI Exploration have concluded negotiations to open the way for ENI to commence exploration and production.

    Under the agreement, the $6 billion OCTP (Sankofa Project) is expected to start commercial production of oil and gas by mid-2017 to augment the country’s current production capacity.

    A statement signed by the Energy and Petroleum Minister, Mr Emmanuel Armah-Kofi Buah, said the next stage of the agreement would be the approval of a plan of development (POD) and ratification of the approval by Parliament.

    “This negotiation has taught Ghana a lesson of the urgent need to strengthen the balance sheet of the country’s energy institutions to enable them to borrow on the international market. It will also reduce the investment risk that has been a major hurdle in this negotiation,” it said.

    Third FPSO

    It said the project would deliver up to 170 million cubic feet of gas per day for the next 20 years and put Ghana on its way to a future when one of the critical constraints to power generation (cheaper fuel) would be addressed.

    “The start of commercial gas production will also require the construction of a third FPSO unit to produce a maximum 170 million cubic feet of gas, in addition to the 120 million cubic feet from the Jubilee Fields and the 50 million cubic feet from the Tweneboah Enyeara and Ntome (TEN) projects,” it said.

    The statement said ENI, which had been operating in Ghana since 2009 and currently operated two exploration-offshore blocks: OCTP and Keta, had been present in sub-Saharan Africa since 1960 and been involved in exploration and production projects in more than 10 countries, including the Democratic Republic of Congo, Angola, Kenya and Togo.

    It said Mr Buah and the Finance Minister, Mr Seth Terkper, who led the Ghana negotiating team, expressed their relief at the conclusion of the negotiation with ENI/Vitol, which had lasted over one year, noting that “it puts Ghana on the path to energy security, as there will be more gas to fuel generating plants”.

    Challenges in the industry

    The country’s power sector has been dogged by a number of challenges recently.

    The challenges have been attributed to unreliable gas supply, frequent drops in the water levels at the Akosombo and the Bui power generation plants, the high cost of crude oil to power plants and regular maintenance schedules of power plants, leaving the country in generation deficit frequently.

    Currently, Ghana is grappling with a power generation deficit of between 350 and 400 megawatts (MW), a situation caused by erratic gas supply from Nigeria and the shutdown of some machines for regular maintenance works.

    Current generation capacity

    The country’s energy mix is made up solar, thermal and hydro.

    The hydro generation is dominated by the Akosombo Dam, which supplies about 1,020MW of energy, followed by the Bui Dam, which produces 400MW, with the Aboadze Thermal Plant producing 360MW and the Takoradi Thermal Plant 330MW.

    Kpong produces 160MW, while the country’s first solar plant at Punga in the Upper East Region produces 2MW, giving the country 2,272 MW of combined electricity supply.

    Source: Daily Graphic

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