BOST Gears Up for Gas Storage Facility

By J. Ato Kobbie, Managing Editor [The Business Analyst]

Processes towards constructing a gas storage terminal for processed gas, including liquefied petroleum gas (LPG) by the Bulk Oil Storage and Transportation Company Limited (BOST) have began earnestly, even as the company awaits its natural gas transmission utility (NGTU) licensing by the Energy Commission.

The project includes integrating all of BOST's depots and involves a petroleum terminal at Pumpuni, 25-kilometres west of Takoradi in the Western Region, where processed gas from the Jubilee Oil Field would be stored. Valued at $235million, the project, which includes a network of storage facilities, tanks and pipelines as well as export and re-export facilities is to be funded largely under the $3billion China Development Bank (CDB) loan, the Master Facility Agreement (MFA) of which Parliament approved early this year, after it was first presented to the House in August 2011. A subsidiary agreement covering $200million dollars of the CDB loan, representing 85% of the total project cost, is expected to be passed by Parliament as one of three outstanding agreements, following the passage of nine others under the current phase of the facility.

“With the CDB facility, the basic project will involve having a petroleum terminal, at Pumpuni with 150scm storage Petroleum products, 20,000 gas coming from the gas processing plant from Atuabo.

Already, preparatory works are ongoing on a 300-acre land acquired by government under an Executive Instrument, with compensation payment totaling about GHC4.5 million also ongoing and expected to be completed by end of June this year. The compensation is part of the project cost.

BOST has selected Petrochem Engineering Services as Consultants for the front end engineering and design (FEED) works and they are currently carrying out the basic engineering work, including confirmation of hydrological surveys. “We have already done the feasibility studies; we’ have already done the environmental impact assessment; report is ready and we are working with the Environmental Protection Agency (EPA) for the necessary permits,” Dr. Akoto told The Business Analyst.

With government policy hinging on the gas component as the pivot on which a new growth pole to drive the economy rests, BOST, which currently manages a network of seven storage depots, ensures strategic stock reserves of 6 to 12 weeks products, is expanding its infrastructure.

Even though the entire project is estimated to take 18 to 24 months to complete, aspects of it such as the LPG storage facility construction is projected to be fast-tracked to coincide with the completion of the gas processing plant and pipelines by the Ghana National Gas Company (Ghana Gas), to terminate at Pumpuni, the site for the BOST storage facility.

Ghana Gas is scheduled to start taking delivery of the pipes to be laid from the shallow water, 14 kilometres from the Jubilee Field, as well as onshore transmission pipes covering over 100-kilometers to terminate at Pumpuni. The gas infrastructure project represents BOST’s flagship under a new mandate it is seeking to become the natural gas transmission utility.

BOST is seeking, under the expanded mandate, to transport the natural gas associated with the off-shore oil and gas production once the gas is piped on-shore. It already manages a network of 360-kilometres of pipeline. “BOST’s new mandate is to become the natural gas transporter, which means we would develop, build and manage the network of transmission pipelines we would need to move natural gas from its source to destinations such as markets and end users,” Dr. Akoto had told The Business Analyst.

Besides the gas infrastructure, BOST is going to construct both tanker and rail loading facility, a common berthing mechanism (CBM), to serve as an alternative distribution point to the only one at Tema.

First processed gas from the Jubilee Field, is earmarked to be wheeled from Atuabo, where the gas processing plant is to be located, to the Pumpuni facility for storage, from where it would be piped to fuel the Aboadze Thermal plant in Takoradi, to reduce the cost of generating electricity.

Besides Aboadze, the target markets for the processed gas includes power plants for cheaper electricity to process minerals such as bauxite, manganese and iron ore and the mining areas in the Western region.

Government has targeted also to boost domestic LPG requirements as well as natural gas liquids gas liquids for petrochemical industries, including fertilizer production. BOST’s original role has involved developing, owning, managing and maintaining a national network of storage depots and petroleum pipelines to facilitate the smooth bulk transportation, storage and distribution of petroleum products The company, which was established in 1993, distributing refined petroleum products from its depots that are strategically located around the country and has since built significant capacity, with some of its technical personnel currently involved in the Ghana Gas project.

Author: j.atokobbie@yahoo.com

A print version of this article was published in The Business Analyst of Wednesday, May 9th – Tuesday, May 15th, 2012