Ghana 1000 Consortium and Shell Enter into Exclusive Negotiations for LNG Supply to the Ghana 1000 Power Project
- LNG can potentially lower the cost of power in Ghana by up to 35 percent when compared to power generated from light crude oil.
- The ability to import LNG into Ghana will provide the country with much needed fuel security, flexibility and diversity.
9 March 2015, Accra, Ghana: Co-lead developers General Electric (NYSE: GE) and Endeavor Energy and partners Eranove and Sage Petroleum have agreed a supply term sheet with Shell and entered into exclusive SPA negotiations regarding a long-term supply agreement for liquefied natural gas (LNG) for the Ghana 1000 project.
The Ghana 1000 project is an integrated gas-to-power project that will consist of 1,300 MW to be delivered in two phases, a floating storage and regasification unit (FSRU) and related infrastructure necessary to import LNG. It will be Sub Saharan Africa’s largest power park and will generate reliable power for Ghana as well as help lower the cost of power for the country by up to 35 percent when compared to power generated from light crude oil.
The first phase of the Ghana 1000 project is expected to be completed in late 2016 and will add 125MW to the grid. This will increase to 750MW by 2018 and 1300MW within five years.
“We are delighted to have reached agreement with Shell on the key parameters of a long-term LNG supply arrangement and have entered into exclusive discussions on a long-term LNG supply for the Ghana 1000 project,” remarked Leslie Nelson, CEO of GE Ghana. “Securing a reliable, flexible and affordable LNG supply arrangement is a critical piece of the puzzle to make this project a reality.”
CEO of Endeavor Energy Sean Long said the inclusion of Shell will add another world class player to the already impressive roster of participants in the Ghana 1000 project. “Shell is the world’s leading LNG supplier and has demonstrated the capability to offer innovative and collaborative solutions for the needs of a transitioning power market such as the one developing in Ghana. Importing LNG offers tremendous flexibility for Ghana to manage its power fleet. As a lower cost alternative to light crude oil, LNG can be used not only on a long-term basis for new power projects, but can be imported on a spot basis to balance any short-term disruptions from Ghana’s domestic gas production or from diminished hydro production in years with low rainfall.”
Mr. Nelson also disclosed that Sage Petroleum, a wholly-owned Ghanaian company and is the largest indigenous Oil Trading Company in its country, is the latest entrant to join the Ghana 1000 consortium and will play a key part in its success. ”Sage joining Ghana 1000 fulfills the consortium’s commitment to ensure localisation of operations in Ghana.”
Last month, Endeavor Energy and GE announced the signing of an agreement with Excelerate Energy, a leading provider of floating storage regasification units (FSRU), for the reservation of an FSRU that will provide storage and regasification of liquefied natural gas (LNG) for the Ghana 1000 project.
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About Endeavor Energy
Endeavor Energy is a privately held international independent power producer (IPP) company, headquartered in Houston, Texas, focused on developing and investing in power generation facilities in Africa. With the financial backing of Denham Capital (www.denhamcapital.com), an energy and resources-focused global private equity firm with $7.9 billion of invested and committed capital, the company possesses significant financial and operational capabilities to generate and participate in multiple power development projects in Africa. Endeavor Energy is also a sponsor of the U.S. government’s Power Africa initiative. For more information about Endeavor, visit www.endeavor-energy.com.
About Sage Petroleum
Sage is the largest licensed Oil Trading Company in Ghana. The company’s activities are carried out by experienced and highly trained professionals and supported by our key partnerships with refineries, international trading companies and local partners in various countries. In line with our pedigree as recipients of multiple consecutive International Quality Awards, our activities are managed and supported by an advanced, real time Risk Management platform that gives real time insight into all aspects of the company’s business including stocks, logistics, finance, profitability and risk exposures
The Eranove group is a West African leader in public service management and electricity and drinking water production. The group provides operational assistance to its subsidiaries: technical supervision, procedures, procurement, cash flow, management control, legal & tax, etc. For more information visit www.eranove.com
(Communications Manager, GE West Africa)
(On Behalf of Endeavor Energy and Denham Capital)