GNPC, Quantum Power agree to terms on Tema LNG project

The Ghana National Petroleum Corporation (GNPC) and Quantum Power, the pan-African energy infrastructure investment platform, have signed Heads of Terms for the construction and operation of liquefied natural gas (LNG) storage, regasification and delivery facilities at Tema.

The Tema LNG Project will have the scalable ultimate capacity to receive, store, re-gasify and deliver at steady state of about 3.40 million tonnes of LNG per year, equivalent to 500 million standard cubic feet of gas per day, by utilising a state-of-the-art dedicated floating storage and regasification unit (FSRU) moored off-shore Tema.

An associated sub-sea and onshore pipeline will deliver the natural gas to GNPC and its customers onshore. The Tema LNG Project, comprising a capital outlay of over US550 million, will be implemented on a build-own-operate-transfer (BOOT) basis with the assets being transferred to GNPC after the project’s 20-year term.

Commencement of operations is scheduled for the end of 2016, and given its design the Tema LNG Project has a built-in scalability that will allow it to play an increasing role in meeting Ghana’s growing energy demand — providing the Ghanaian power generation industry with a highly reliable and clean fuel supply to meet projected power and industrial needs over the next 20 years. The Tema LNG Project will provide GNPC with the flexibility to manage volatility in power demand and fluctuations in domestic gas supply, while mitigating the effect of unpredictable rainfall on Ghana’s power balance.

The Tema LNG Project has been under development for three years, involving some of the world’s most experienced engineering teams collaborating on an innovative design to address the specific maritime challenges in the Gulf of Guinea, while assuring optimal year-round operability. The terminal will be located 12 kilometres off Tema’s shore and allows for cost-efficient refuelling and regasification without affecting maritime and port traffic.

Alexander Mould, CEO of GNPC stated: “We are pleased to announce our agreement with Quantum Power. As the national gas sector aggregator GNPC is leading Ghana’s efforts to develop the gas-to-power value chain, supporting government’s vision of energy security for accelerated economic growth.

“The Tema LNG Project is a critical component in achieving this vision as it allows for the diversification of fuel supply sources, enhancing flexibility and reliability. It guarantees GNPC contracted capacity of 250 million standard cubic feet of gas per day, for regasification of competitively-priced LNG.”

Matty Vengerik, CEO of Quantum Power added: “We are delighted to partner GNPC to deploy this cost-efficient and clean fuel supply infrastructure solution in Ghana. This is the first such project to be implemented in sub-Saharan Africa. The combination of increased certainty-of-supply with the cost savings inherent in LNG supply has a significant multiplier effect on the economy at large, as it reduces risk for commercial and industrial activities and increases Ghana’s attractiveness as an investment destination.

“Furthermore, the project will spur directly and indirectly technology and know-how transfer, and maritime and energy employment opportunities in addition to its highly leveragable indirect contribution to economic activity and employment in the country. Quantum Power is proud that GNPC has selected our project as one of its national strategic initiatives.”

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