Nigerian Supplier Cuts Off Ghana Client - Report
N-Gas, the main supplier of Nigerian gas through the West African Gas Pipeline (WAGP), has stopped supplying Ghana’s main gas offtaker Volta River Authority (VRA) because of $166.3mn of debts it has incurred, reported GhanaStar on Jun.21 citing Ghana's deputy power minister John Jinapor.
The GhanaStar report can be read here.
N-Gas is jointly-owned by Nigeria’s state Nigerian National Petroleum Corporation (NNPC), Shell and Chevron. Jinapor said Ghana’s existing power rationing “is not going to worsen” as a result of the N-Gas decision.
GhanaWeb reported May 9 that N-Gas had already then warned state-owned VRA to pay up or be cut off; it noted that on average 20mn ft3/d of Nigerian gas is supplied to VRA for use at the 100 MW Sunon Asogli Power Plant in Tema, a Chinese-built and owned independent power plant (IPP).
The head of the IPP told Graphic Online June 2 that state-run Electricity Company of Ghana’s $100mn debt to Sunon Asogli was a major challenge to its work, as it meant that the IPP could also not pay VRA for its supply of gas via WAGP, thus creating a cycle of debt in the power generation sector.
Flows via WAGP have long been considered erratic, compared to offshore Ghanaian production.
Ghana expects to receive a 400 MW ship-mounted power plant from Turkey’s Karadeniz Holdings in the next two months at the port of Tema. In 2014 Karadeniz agreed to provide two power barges under a ten-year power purchase agreement with the state-run Electricity Company of Ghana. The first powership (225 MW) arrived in November 2015 at Tema and has burned crude oil and heavy fuel oil. The Turkish firm said then that its powerships would “transition to natural gas during the second half of the project” – an indication that the arrival of the second barge may be timed to take advantage of the near-term berthing of a floating LNG import and regas terminal, FSRU Golar Tundra.
This FSRU however has waited at anchor about five miles offshore Tema for over three weeks. Moreover, it is chartered to a joint venture of NNPC and Nigeria private generator Sahara Energy. So unless N-Gas’s bill is paid, deliveries of LNG into, and gas out of, the FSRU may be delayed.
Ghana’s gas for power supplies are critically dependent on key infrastructure. The Chinese-built Atuabo gas process plant, operated by state-run GhanaGas, had a 72-hour unscheduled outage last week. It receives gas from the Tullow-operated offshore Jubilee field. Earlier this year, the Jubilee field – which can supply 90mn ft3/d of associated gas -- itself shut for a planned outage, which then overran by one month.
Mark Smedley | www.naturalgasafrica.com