Ghana signs $7billion contract with Eni to produce oil, gas at Offshore Cape Three Points Block
- Created on Monday, 02 March 2015 13:58
Ghana took another major step towards the attainment of energy and power security with the signing of an agreement for the development of the Offshore Cape Three Points ( OCTP) integrated oil and gas project.
The $7 billion project, being undertaken by Italy's largest oil company, Eni Spa, in collaboration with Vitol Energy, will see the development of the Sankofa and Gye Nyame fields that will provide substantial gas to operate Ghana’s thermal power plants for 20 years.
President John Dramani Mahama, who said the project was probably the biggest single foreign direct investment (FDI) in Africa this year, and the Vice-President, Mr K.B. Amissah-Arthur, witnessed the signing ceremony at the Peduase Lodge in the Eastern Region yesterday.
The Chief Executive of the Ghana National Petroleum Corporation (GNPC) and the Minister of Petroleum, Mr Emmanuel Armah-Kofi Buah, signed for Ghana, while the Executive Vice-President of Eni Spa in charge of Sub-Saharan Africa, Mr Ciro Antonio Pagano, and the President and CEO of Vitol, Mr Tan Taylor, signed for Eni and Vitol respectively.
Oil production from the OCTP is estimated at 80,000 barrels per day and will start in 2017, while gas comes on board in 2018.
The project will deliver 170 million cubic feet of gas per day and it is expected to generate an additional 1,100 megawatts of power for Ghana.
Gas will be processed and transported via a dedicated pipeline to onshore gas-receiving facilities located near Sanzule, a coastal village in the Western Region.
The gas will also be compressed and injected into the Western Corridor Gas Pipeline for transportation to industrial customers in Ghana.
Crude oil will also be stored in the FPSO and offloaded to tankers for sale on the international market.
Ghana is represented on the project by the GNPC.
President Mahama described the signing of the agreement as "a landmark event in the development of oil and gas in Ghana", as it would lead to energy and power security for the nation.
He said a survey on Ghana had revealed that energy was the most binding constraint on the economy. He asked Ghanaians to empathise with the government due to the current electricity load shedding.
President Mahama added that the agreement was a win-win affair and indicated that the World Bank had issued a partial risk guarantee for the project.
Mr Pagano said the project was indicative of the start of Ghana’s transformation.
He also said the fact that the project was coming on board at a difficult time for the oil and gas industry, due to falling prices, was testimony of the trust the company had in the Ghanaian economy.
Mr Taylor said the company was proud to be part of such an important venture.
"Vitol has been supplying energy to Ghana for over 25 years and we are delighted to be able to contribute to the development of Ghana’s economy through a major domestic energy solution," he said.
source: graphic online