Ghana: GNPC Explains Investment on Tema Liquefied Natural Gas Terminal Project

According to the Ghana National Petroleum Corporation (GNPC), Ghana’s Tema Liquefied Natural Gas (LNG) Terminal – the first of its kind in sub-Saharan Africa – is expected to safeguard the country’s future energy needs and lead to an era of affordable gas.

The terminal’s Floating Regasification Unit arrived in Ghana on January 7, 2021. However, energy industry experts have raised concerns regarding the potential threats and effects of gas that is not used effectively, and how this could impede the development of local gas resources. The GNPC has addressed these concerns by stating that the facility will increase the nation’s energy mix for power generation and industrial use, among other benefits.

“The Tema LNG is cheaper than Sankofa and cheaper than the gas coming from Nigeria,” stated Dr. Kofi K. Sarpong, CEO of GNPC. “Although prices can change anytime, as I speak, the formulation is cheaper than the one coming from Sankofa. The only LNG which is cheaper is from Jubilee and TEN but they cannot give you the volumes you need because of production constraints and challenges from the Ghana Gas plants.”

Demand for gas in Ghana has increased significantly in the last two years, from 211 million standard cubic feet (scf) to 296 million scf and is expected to exceed 300 million scf this year. These volumes are produced in the Jubilee, TEN and Sankofa fields as well as from Nigeria through the West Africa Gas Pipeline.

“One reason we need LNG is to increase the energy mix for power generation. We can have upset conditions in the domestic production fields and it has happened a couple of times when one is not able to come on-stream,” added Sarpong.

“In Tema where we have installed the LNG plant, the demand for gas is 250 million scf a day, which explains why we still take from Nigeria and from the West to add up to gas requirements in Accra. There are power plants with installed capacity of about 1500 MW and that will need about 260 million scf a day. We cannot get that alone from the West, we have to even transport some along the West Africa Gas Pipeline which costs us more money and it is a major issue in terms of cost. When you add that to the Sankofa gas, it is way too expensive,” he explained.

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