Business News of Wednesday, 11 March 2015
General Electric (GE), Endeavor Energy and partners Eranove and Sage Petroleum have entered into a long-term supply agreement for Liquefied Natural Gas (LNG) for the Ghana 1000 project.
The Ghana 1000 project is an integrated gas-to-power project that will consist of 1,300 MW to be delivered in two phases, a floating storage and regasification unit (FSRU) and related infrastructure necessary to import LNG.
Sylvester Palacios, the Communications Manager, GE West Africa, said in a statement copied to the Ghana News Agency on Tuesday.
The statement quoted Mr Leslie Nelson, the Chief Executive Officer (CEO) of GE Ghana as saying: “We are delighted to have reached agreement with Shell on the key parameters of a long-term LNG supply arrangement and have entered into exclusive discussions on a long-term LNG supply for the Ghana 1000 project.”
“Securing a reliable, flexible and affordable LNG supply arrangement is a critical piece of the puzzle to make this project a reality,” he added.
Mr Nelson also disclosed that Sage Petroleum, a wholly-owned Ghanaian company, the largest indigenous Oil Trading Company in its country, is the latest entrant to join the Ghana 1000 consortium and will play a key part in its success.”
“Sage joining Ghana 1000 fulfills the consortium’s commitment to ensure localisation of operations in Ghana,” he added.
The LNG arrangement will be Sub Saharan Africa’s largest power park and will generate reliable power for Ghana as well as help lower the cost of power for the country by up to 35 per cent when compared to power generated from light crude oil, he said.
The first phase of the Ghana 1000 project is expected to be completed in late 2016 and will add 125MW to the grid and is expected to increase to 750MW by 2018 and 1300MW within five years.
The CEO of Endeavor Energy, Sean Long said the inclusion of Shell will add another world class player to the already impressive roster of participants in the Ghana 1000 project.
Long said: “Shell is the world’s leading LNG supplier and has demonstrated the capability to offer innovative and collaborative solutions for the needs of a transitioning power market such as the one developing in Ghana.
“Importing LNG offers tremendous flexibility for Ghana to manage its power fleet. As a lower cost alternative to light crude oil, LNG can be used not only on a long-term basis for new power projects, but can be imported on a spot basis to balance any short-term disruptions from Ghana’s domestic gas production or from diminished hydro production in years with low rainfall.”
Last month, Endeavor Energy and GE announced the signing of an agreement with Excelerate Energy, a leading provider of floating storage regasification units (FSRU), for the reservation of an FSRU that will provide storage and regasification of LNG for the Ghana 1000 project.
The LNG can potentially lower the cost of power in Ghana by up to 35 per cent when compared to power generated from light crude oil.
The ability to import LNG into Ghana will provide the country with much needed fuel security, flexibility and diversity.