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Oil and Gas

Ghana : Nigeria cuts gas supply by more than half

Friday, 30 March 2018 21:17

(Ecofin Agency) - Since the beginning of this year, Nigeria has just been sending about 60 million cubic foot of gas daily to Ghana via the West Africa Gas Pipeline Company Limited (WAPCo). This is less than half of the contractual volume agreed upon during the commissioning of this infrastructure in 2011 in Nigeria. Indeed, the contractual volume was 123 million cubic foot daily and it should help generate electricity in Ghanian thermal power plants. Even so, since the day the agreement was signed, Nigeria has never been able to send 100 million cubic foot a day.

This is revealed by Kweku Andoh Awotwi, Board Chairman of the Volta River Authority (VRA), the leading electricity producer in Ghana, and the new managing director of Tullow Ghana who took office on March 1st.  

According to the official who expressed his views in an interview with Ghana Web, this cut in the volume supplied is due to the Ghanaian party’s incapacity to pay its debts towards NGas, the Nigerian gas supplier.  Apart from the debt estimated at $40.3 million, there is also the vandalism of its pipelines on the Niger and the continuous shortage of gas for Nigerian thermal centers.   

“We are at about half of what we have been contractually promised, which is not good enough. There are many reasons for that; the vandalism of pipelines and the fact that we have not paid our bills”, Kweku Andoh Awotwi said. He also indicated that there were ongoing negotiations to increase the daily supply to 90 million cubic foot.

Meanwhile, the official revealed, the volume supplied are now prepaid by the Volta River Authority. “We are putting in Letters of Credit (LCs) to get the gas,” he explained.

Let’s note that Ghana which receives about 25% of its thermal electricity needs from Nigeria, is multiplying the efforts to boost its electricity generating capacity due to the throes of power cuts.

The man also expressed his confidences in the future because his country’s gas fields could help reduce Ghana’s dependence on the gas from Nigeria.  “I see that over the next 6-12 months things should improve; it ought to improve. Sankofa is coming, TEN has started, and it balances out some of the shortfall from Jubilee”, he said.

Let’s remind that the Sankofa gas field, offshore Cape Three Points, should produce about 180 million cubic gas daily. That volume would be used for thermal electricity generation for local demands.

Olivier de Souza

 
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ECOFIN AGENCY offers a selection of articles translated from AGENCE ECOFIN. Founded in 2011, Agence Ecofin is a leader in Francophone Pan-African economic news, particularly in West and Central Africa. The agency publishes daily news on nine African economic sectors: Public Management, Finance, ICT, Agribusiness, Energy, Mining, Transport & Logistics, Communication, and Training.

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