Page 12 - GLNG Week 46 2022
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GLNG                                              AFRICA                                               GLNG




       African NGOs call for





       suspension of Tema LNG





       project in Ghana







        PROJECTS         A group of African non-governmental organisa-  local energy markets, as well as updates to the
                         tions (NGOs) has called for the suspension of the  governance model of the project, among other
                         Tema LNG project in Ghana, arguing that the  changes.
                         deal could end up costing the country $1.5bn, as   Additionally, they have raised serious doubts
                         government officials have noted that there is no  about the feasibility of the project on the grounds
                         immediate demand for the natural gas that will  that Ghana had not developed renewable energy
                         be imported via the terminal.        resources,  even  though  they  were  quickly
                           Tema LNG, whose operator is backed by  becoming a more economical form of energy.
                         Helios Investment Partners of the UK and Afri-  “Development finance institutions have spent
                         can Infrastructure Investment Managers (AIIM)  at least $2.8bn in direct project finance to support
                         of the Netherlands, is key to Ghana’s plans to  the development of upstream and downstream
                         become a gas hub. The terminal was originally  fossil fuel projects in Ghana since 2010. Mean-
                         expected to become operational as early as 2020  while, Ghana’s vast renewable energy potential
                         but has yet to take delivery of any LNG.  has generally been overlooked,” the statement
                           The group of African NGOs, convened by  said. “Ghana’s modern renewable generation
                         the African Centre for Energy Policy (ACEP)  capacity remains negligible, at less than 1% in
                         and IMANI Centre for Policy Education think-  2020. This is despite renewable energy sources,
                         tanks, issued a statement on November 9 outlin-  such as solar, now being the cheapest form of
                         ing its arguments for the scrapping of the project.  energy in many parts of Africa, according to the
                         “[The] origins of the Tema LNG project in per-  International Energy Agency (IEA) – and are set
                         verse bid-rigging and attendant procurement  to outcompete all other sources continent wide
                         irregularities have heightened the corruption  by 2030.” 
                         risk associated with the project,” the statement   According to previous reports, the Tema
                         said.                                LNG terminal consists of a floating regasifica-
                           The organisations also asserted that Ghana  tion unit (FRU) with a capacity of 1.7mn tonnes
                         National Petroleum Corp. (GNPC), the finan-  per year (tpy) and a floating storage unit (FSU)
                         cially strained national oil company (NOC),  that can hold up to 160,000 cubic metres of gas.
                         could not afford to continue with the pro-  The facility is already slated to receive LNG from
                         ject. “GNPC could be paying between $790mn  Nigeria under a 17-year supply agreement with
                         [and] $1.357bn a year (based on average 2022  a unit of Shell (UK), and it will deliver the gas to
                         Brent crude prices) for gas [that] the country  GNPC under a long-term off-take contract.
                         doesn’t need,” it said.                GNPC, which serves as the country’s gas
                           The NGOs are calling for the public release of  aggregator, will mostly make the fuel availa-
                         all contracts and documents related to the Tema  ble for use gas in domestic power generation,
                         LNG project, as well as all other entities with  according to Ben Asante, the CEO of the state-
                         commercial connections to the initiative. They  owned gas utility, Ghana National Gas Co.
                         have also urged a complete renegotiation of the  (GNGC). However, gas will also go to other
                         financial and commercial terms of the scheme to  industries, such as petrochemicals and cement,
                         better reflect the current conditions in global and  Asante told Bloomberg.™
















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