Business News of 2014-06-02

Atuabo Gas Processing Plant: Solution to energy crisis?

If there is a single project in Ghana which the government in particular and Ghanaians are so much expectant of, that arguably is the Gas Processing Plant at Atuabo in the Ellembele District in the Western Region.

Against the backdrop of the power crisis that the nation is going through, expectations are that the $850 million Atuabo project holds the key to unlocking the problem.

Actual construction work started in August 2012 but attempts to complete it and kick-start operation had fizzled out on two occasions in the past with financial and technical problems as the main causes.

During a visit to the project site on May 24, this year, officials told the Daily Graphic that installation works were complete.

What was outstanding was work to address two major tasks in the deep waters of the sea to enable gas flow from the fields to the plant.

The Minister of Energy, Mr Armah-Kofi Buah, has just stated that come September, the project will start full operation.

Ghana’s power challenges

The depth and complexity of the issues involved in the electricity crisis have been explained by experts in the field.

Ghana’s electricity is powered by hydro and thermal. It is, however, believed that there are structural problems within the two areas.

Gas supply from Nigeria to Ghana has also suffered a drastic cut in recent times, thus compounding the energy problem.

Reports indicate that the cut in supply to Ghana is due to the introduction of a number of thermal plants in Nigeria to augment its power generation and supply capacity.

In spite of efforts by the Ghana government to get Nigeria to increase supply to Ghana, the response has not been better.

Although successive governments have recognised the need for increased energy generation, what had been done does not match up to the increasing demands of electricity for both domestic and commercial uses.

It was against this backdrop that the government began the development of the necessary infrastructure at Atuabo to process natural gas from the Jubilee Fields to feed the thermal plants.

Estimated gas reserves of the Jubilee field are put at 1.4 trillion cubic feet.

Ghana Gas Company

To ensure the effective management of the Gas Processing Plant and other related critical issues including the gathering, transportation and marketing of natural gas in the country, the Ghana Gas Company (GGC) was established in July 2011.

The coming of the company followed the inauguration of a Gas Development Task Force in February 2011 by the then President John Evans Atta Mills to study and make recommendations on how to take full advantage of the oil find in Ghana.

The recommendations made by the task force included the treatment of associated gas from the Jubilee Field to boost the country’s energy generation.

Following the recommendations, GGC was established and has since been working to put the project in operation.

Profile of Gas Project

Located on the coast of Western Ghana, the Atuabo Gas Processing Plant is part of the Western Corridor Gas Infrastructure Project.

Construction work started in August 2012 with the Chinese firm, Sinopec International Petroleum Corporation as the lead contractors.

Other specialised works that were handled by different contractors included laying of offshore pipeline which was handled by Micoperi of Italy and Engineering by J.P. Kenny of the United Kingdom

The plant will receive wet gas from the FPSO Kwame Nkrumah in the Jubilee Field via a subsea pipeline.

A 60km offshore pipeline connects the plant to the point where Tullow will do the connection for the gas to flow.

Besides, a 111km gas pipeline has been constructed from Atuabo to Aboadze to feed the Volta River Authority’s thermal plant.

A distribution station has been established at Essiama to feed Takoradi.

Ghana Gas Company is also constructing a 75km lateral pipeline from Essiama to Prestea to feed a second distribution centre.

The raw gas received would be treated by means of a cryogenic separation to meet pipeline quality and end-users specification.

The plant pipelines are designed to accommodate 240 million standard cubic feet of gas a day.

However, the first phase would process 150 million cubic feet or 440 million standard cubic metres of gas per day.

This would also lead to the production of 670 tonnes of LPG which would add on to boost the country’s supply.

A major by-product of crude oil production is generation of Liquefied Petroleum Gas (LPG). From the Jubilee Field, associated gas that would be piped to the Atuabo Plant would also be used to produce LPG.

Four tanks each with a capacity of 2000 metre cube each have been built to store the LPG. They have a holding capacity of 10-14 days.

With regard to transportation of the produce, a truck loading bay being built by a private company is near completion, while the GGC has also acquired land about 2.5 km away from the plant to construct another one.

A GGC source said they did not want any monopoly in the system that was why they were constructing a truck loading bay to add up to the one managed by a private company.

In the second phase, LPG will be conveyed to Tema and Takoradi by vessels.

This will rise to 800 million standard cubic metres when the second phase is put on line.

GGC is currently undertaking the last two major tasks in the deep waters of the Atlantic Ocean to facilitate the first flow of wet gas from the Jubilee Field to the plant.

They involve moves to retrieve a lost pig, and a pipeline free span rectification, both of which GGC inherited from the Ghana National Petroleum Corporation (GNPC).

One other important aspect of the project is the inclusion of funds to acquire two helicopters to monitor the operations both onshore and offshore.

To avoid a recap of what happened to the West Africa Gas pipeline when encroachment led to its destruction, a 35-metre corridor has been left on the pipeline from Atuabo to Takoradi.