Page 11 - DMEA Week 18 2020

DMEA REFINING DMEA
Ghana must exploit low oil prices to help Tema refinery: union
GHANA
Tema has been operating at under half its 45,000 bpd capacity since an explosion in January 2017.
TRADE union authorities have urged the Ghanaian government to take advantage of low oil prices to buy cheap crude for the country’s sole refinery.
The Tema Oil Refinery (TOR) has been operating at under half its 45,000 barrel per day (bpd) nameplate capacity since an explosion at its distillation unit in January 2017, resulting in the shutdown of one of its furnaces. The plant has also struggled to afford oil imports and would need major upgrades to process local crude.
In an open letter to Ghanaian President Nana Akufo-Addo, the Tema District Council of Labour (TDCL), part of Ghana’s Trades Union Congress (TUC), said that buying extra oil now would lead to lower fuel prices.
“This will go a long way to help reduce the prices of petroleum products and sell at realis- tic prices, make TOR profitable and ensure that there is adequate supply of the petroleum prod- ucts on the market,” the TDCL stated.
The council has repeatedly warned that the refinery is at risk of closure, which would increase Ghana’s reliance on fuel imports. The
government has been scouting for investors to repair and modernise the plant, thus far without success.
TOR announced in December that it had reached a deal to process oil on behalf of Wood- field Energy Resources. It is a tolling agreement, meaning that instead of buying oil itself, the refinery will charge Woodfield a fee for process- ing it, and will not own the finished products. TOR has not provided an update since then on the deal’s implementation.
The refinery was rocked by a scandal last month when its head, a former Goldman Sachs banker, was forced to step down after US regu- lators sued him for allegedly arranging bribes while he was working at the financial group.
Asante Berko, aged 46, resigned after only four months as the plant’s director. He is accused of arranging for an energy company to send at least $2.5mn through a Ghana-based intermediary to government officials while working at Goldman’s investment-banking unit. Berko resigned from the bank in Decem- ber 2016. ™
PETROCHEMICALS
Ethiopia commissions gas processing study
ETHIOPIA
Ethiopia’s gas reserves were discovered decades ago but have not been developed.
THE Ethiopian Petroleum Ministry has com- missioned a study from US-based firm Green- Comm Technologies into how Ethiopia’s gas resources can be used to produce various fuels.
An agreement was signed by the ministry and GreenComm covering a year-long study. Specif- ically, the study will evaluate the development of a gas processing plant. South Korea’s Hyundai Engineering and Construction is collaborating in the project, according to the ministry.
The cost of the plant is initially assessed at $3.6bn. The study will weigh up the feasibility of using gas resources at six sites. These include the Calub and Hilala fields in the Ogaden Basin in Ethiopia’s Somali region, which Chinese firm POLY-GCL Petroleum is currently developing.
Gas could be supplied to the plant and then processed to produce liquefied petroleum gas (LPG), jet fuel and petrochemicals, the ministry said.
Ethiopia is estimated to have roughly 25bn cubic metres in proven gas reserves. The
country found extensive gas deposits in its east- ern Ogaden Basin in the 1970s, but has been unable to monetise them owing to decades of war and political upheaval. Finding a route to market for the resources was also an issue.
POLY-GCL signed production-sharing deals to exploit the Calub and Hilala fields in 2013. The Chinese firm finished appraisal wells at the sites in 2016, and the following year signed a memorandum with neighbouring Djibouti on building a pipeline to pump Ethiopia’s gas to the small Horn of Africa nation. It also planned to build a liquefaction terminal at Damerjog, near Djibouti’s border with Somalia. The project was valued at $4bn.
Djibouti and Ethiopia then signed an inter- governmental agreement on the pipeline in February last year. At the time, POLY-GCL was expected to launch production at Calub and Hilali in 2020, several years behind schedule.
POLY-GCL is a joint venture between state- owned China POLY Group and privately owned Hong Kong-based Golden Concord Group. ™
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