The Tema LNG Terminal Company Limited, an entity controlled by Helios Investments, has signed an agreement with China Harbour Engineering Company for the construction of a Liquefied Natural Gas (LNG) Terminal in Tema.
Helios Investment and Rosneft, the world’s largest listed producer of crude oil, which holds a 100 percent equity in the Tema LNG Company project, is the world’s largest Africa-focused private equity fund.
Witnessing the signing of the agreement in Beijing, China, as part of his official visit to that country, His Excellency, Nana Addo Dankwa Akufo-Addo, President of the Republic of Ghana, said the Tema LNG Terminal Project was testament to the efforts his government had put in place over the last 19 months to encourage private sector participation in the growth of the economy.
He said the construction of the terminal was in line with the commitment of his government to providing Ghana with constant, reliable and affordable power supply. “If we are going to succeed in pushing the industrial development of our country rapidly, the supply of gas, which will mean even more affordable rates of power to our country is now a matter of very great importance for us,” he emphasized.
The Tema LNG Terminal Project, being a private sector-funded and driven project, led by established international sponsors, such as Rosneft and Helios Investments, the world’s largest Africa-focused private equity fund, there was no requirement for capital from Government.
China Harbour Engineering Company, which is already involved in the current Tema port expansion project, is constructing the marine facilities, while Jiangnan Shipyard of China will be constructing the floating regasification facility.
The cost of the project is estimated in excess of some US $350 million, of which US $200m will be spent directly in Ghana over the next 18 months. The construction of the LNG Terminal, which is expected to be completed in 18 months, will be sub-Saharan Africa’s first regasification terminal.
When completed, the LNG Terminal is expected to strengthen Ghana’s position as a regional trade and energy hub and is estimated to provide about two million tonnes of liquefied natural gas every year and generate some 1,600 jobs.
The construction of the LNG Terminal comes on the heels of a 12-year gas supply agreement that was signed and executed by the Ghana National Petroleum Corporation (GNPC) and Rosneft.
This means that the facility will supply about 30% of Ghana’s total electricity generating capacity, displacing crude oil and crude derivatives as fuel sources for the generation of power.
A concessional agreement, signed between the Ghana Ports and Harbours Authority (GPHA) and Tema LNG Terminal Company Ltd. to allow for the siting and operation of the facility within the Tema port, will additionally accrue an annual revenue in excess of US $6 million to GPHA throughout the total concession period.
The Terminal will be transferred to the Government ofGhana (GNPC and GPHA) after 12 years.
Present at the signing ceremony were Hon. Kwasi Amoako-Atta, Minister for Roads and Highways; Hon. Joe Ghartey, Minister for Railways Development; Hon. Owusu Afriyie Akoto, Minister for Agriculture; Hon. Kojo Oppong Nkrumah, Minister for Information-designate; and Mr Yofi Grant, Chief Executive Officer of the Ghana Investment Promotion Centre, among others.
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