The Ghana National Petroleum Commission (GNPC) has successfully raised $700 million through access to capital markets to support infrastructure development, Mr Seth Terkper, Minister of Finance has said.
Presenting the 2015 budget to Parliament on Wednesday, Mr Terkper said the facility was not a central government loan.
He said the innovative financing plan is key for the energy sector, where recent negotiations involving gas pricing and GNPC's aggregator arrangements clearly suggest the need for strong Balance Sheets.
“It is in this context that we must see the relevance of the proposed energy levy in the new pricing structure as important,” he added.
The Minister said the uses, as outlined by GNPC, are very clear and compelling, both commercially and strategically.
He said the facility, together with GNPC's other resources, would be used to support investment needs such as the pipeline and receiving facility in the Offshore Cape Three Points Project (OCTP), which GNPC would finance with $493 million out of the loan proceeds, to provide a significant boost to monetising Ghana's natural gas.
“It will result in a lower gas price, similarly, the $36 million to $45 million investment to link the Tweneboa natural gas to the Jubilee FPSO (Floating production storage and offloading unit) will enable cheaper processing of the gas by the Atuabo Plant,” he said.
Mr Terkper said GNPC also plans to use between $200 million and $300 million as part of measures to provide adequate financial security for the OCTP gas project.
He said the facility is expected to be as much a game changer as the investment of about $1.0 billion in the first gas infrastructure.
“These are all critical to our long term national energy security,” he said.
He said it is in this vein that Government has approved the takeover of Ghana National Gas Company Limited (GNGC) by GNPC to create a gas subsidiary.
The consolidation of GNPC and GNGC would make it possible to enhance a more integrated management and continue financing of projects in the oil and gas enclave immediately.
He said this would make it possible to ease the conditions that investors impose for the national gas aggregator and start financing projects in the oil-and-gas enclave immediately.
The sector Minister has Government would appoint a transaction advisor for these purposes and request them to advise on a further consolidation involving Tema Oil Refinery and Bulk Oil Storage and Transport limited.
He said government would consult and learn from the experiences of Sovereign Wealth Funds on the continent and elsewhere, as well as start exploratory talks on financing energy and non- energy infrastructure with the newly established Global Infrastructure Fund of the World Bank and the Africa50 Fund of the African Development Bank.
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