Ghana plans LNG power project to generate 1,500MW by 2016

George Obulutsa

By George Obulutsa

NAIROBI (Reuters) - Ghana plans to build a floating liquefied natural gas (LNG) terminal off its Atlantic Ocean coast to receive imported gas that would be used to produce up to 1,500 megawatts of electricity by 2016, a senior energy official said on Wednesday.

The second-largest gold producer in Africa that is also ranked No. 2 cocoa grower globally says its push to expand industrial production has been constrained by an energy deficit that has seen manufacturing costs soar.

The West African nation plans to build a floating LNG terminal with capacity to handle up to 450 million cubic feet per day of gas, which will then be used to drive turbines that can produce up to 1,500 MW of electricity.

The country of 25 million people generates most of its 2,814 megawatts (MW) of electricity from hydro power dams, the rest from thermal sources and a small portion by solar power.

Ghana's power demand stands at about 1,750 MW and forecast to nearly double at 3,300 MW by 2020.

Kofi Ellis, director of planning and business development at the state-run power utility Volta River Authority, said a feasibility would be done by year-end and the next eight months would be spent on raising funds. The cost of the project would be determined following the feasibility study, he said.

The project itself would then take 12 months to complete, and be ready for operation in 2016, Ellis said.

"Most of our power plants are dual-fired. They are either gas or crude. So if for any reason the gas project delays, we will run it on light crude oil," Ellis told Reuters on the sidelines of the east African power industry conference.

Ghana already produces a small amount of electricity using natural gas from neighbouring oil-producer Nigeria via a pipeline, but this supply fluctuated, depending on Nigeria's demand for power production, he added.

Ghana would rent a floating, storage and re-gasification vessel to transport gas from producers in the region, he said.

"It's always good to have liquefied gas on a long-term supply basis. We have spoken to Angola, we have spoken to Mozambique, we have spoken to Nigeria," Ellis said, referring to the continent's other big oil and natural gas producers.

Ghana would also source natural gas from the United States or the Middle East, but would first start nearer home, he said.

Additionally, Ghana plans to start producing another 150 MW from wind power within the next two years, and to increase solar power to 15 MW from 2 MW at present, Ellis said.