40.8% of electricity generation in Ghana will be powered by Liquefied Natural Gas by 2030, Fitch Solutions has revealed.
This follows the near completion of the LNG terminal at Tema by the end of the first quarter of 2021.
The imported LNG will improve the security of Ghana’s natural gas and predominantly serve the power sector.
“As Ghana’s LNG terminal reaches its final construction phases, we maintain our view that Ghana’s LNG imports will increase to 1.2bcm in 2021”, it emphasized.
It added that the facility is significant for both Ghana and Sub Saharan Africa, as it will mark the region’s first offshore LNG import terminal. The project began construction in 2018 and has experienced numerous delays since.
Once online, the Tema LNG Terminal will operate the $350 million project for 12 years, after which the terminal operatorship will be transferred to the Ghana National Petroleum Corporation (GNPC) and the Ghana Ports and Harbours Authority (GPHA).
The new terminal has the capacity to import around 2.0mtpa of LNG and in May 2018, GNPC signed a cooperation agreement with Russia’s Rosneft to supply 1.7mtpa of LNG over 12 years.
However, the company partners have stated that Royal Dutch Shell will now supply LNG to the facility, which indicates Shell has likely replaced Rosneft as the supplier.
“We forecast Ghana’s gas consumption to increase by 15.0% in 2021, to 4.53bcm as the country begins to recover from the Covid-19 pandemic and the flagship gas-fired Bridge power plant comes online.”
“Our Country Risk team are upbeat about Ghana’s growth prospects and expect real GDP to grow by 4.8% in 2021. Accordingly, recovering industrial and manufacturing activity will support the growing demand for gas in the near term”, Fitch Solutions said.
Throughout its long-term forecast, demand will be driven by the power sector, it added.