Nigeria’s gas export to West Africa sub-region is facing threat from new gas fields emerging in Ghana, one of major recipients of Nigeria’s gas under the West Africa Pipeline Company, Limited, WAPCo.
It was leant that gas obtained from the Sankofa project will enable 1,000MW (Megawatts) of domestic power generation, which is equivalent to approximately 40 per cent of the country’s total installed generation capacity. Besides prospecting new gas fields, Ghana is also complaining of high gas tariff from Nigeria, which may force the country to opt out of the WAPCo deal.
However, it was gathered that WAPCo and the West African Gas Pipeline Authority (WAGPA), have commenced discussions to amend its tariff structure to stay competitive in the market. Currently, the company produces 95 million standard cubic feet per day of gas from the initial 85 million standard cubic feet, through an agreement arrived at before Ghana had developed any gas fields of its own.
Speaking with LEADERSHIP on the issue in Lagos, general manager, Corporate Affairs of WAPCo, Mrs. Harriet Wereko-Brobby said, “You know, we have challenges, it is not only Ghana; the requirement of gas for Nigeria was also a threat.
So, the important thing is to be proactive and try to make the company relevant.” Wereko-Brobby said the company also has its intelligence on ground, adding, “Immediately we heard the information that Ghana wants to take gas from the west to the east, they were planning to build a pipeline, so we went to them and told them that there is one.
“At the time we don’t have any money to invest, so we discussed with them so that the investment can be made by another party that will benefit from the transportation of the gas, so that is the project that is going on right now. It is quite well advanced and apart from that there is a threat of Liquefied Natural Gas (LNG) like in Benin for example they are considering using LNG.
She told LEADERSHIP that those who were buying gas from Nigeria were paying higher compared to those going through the WAGP, because that one was subject to an agreement.
Now that we have many shippers and all the gas coming from Nigeria were considered as one product to CEB of Togo and VRA of Ghana for the same price. According to a recent World Bank report, the net cost of gas to Ghana from the Sankofa Gye Nyame is estimated at $6.60/MMBtu, which is much lower than the current price for gas imports from Nigeria through the West African Gas Pipeline ($8/MMBtu).