Background
The Ghana Energy Policy of 2010 acknowledges that “Ghana has a huge potential to grow and transform its economy through industrialisation with a view to creating jobs and ensuring equitable distribution of wealth.” The role of energy, and for that matter gas, in the transformation agenda of the country was not lost on the framers of the policy. The policy document concedes that; Ghana’s total energy supply must increase significantly if the development agenda is to be achieved. The vision therefore is to develop an “Energy Economy” that would secure a reliable supply of high quality energy services for all sectors of the Ghanaian economy, and to enable Ghana to become a net exporter of oil and power by 2012 and 2015, respectively.
Perhaps, in terms of the timelines for realising the vision, the country was too ambitious. This is because 2012 – 2015 on the contrary happens to be the country’s most difficult years in terms of energy sufficiency. Economic development has been set back severely by an unyielding power crisis in the country.
The national energy policy intent has been to secure future fuel supplies, increase and diversify the fuel mix in power generation, through “support for strategic exploitation of domestic natural gas discoveries” and “encouragement of public-private partnership financing of natural gas infrastructure”.
It is inferred from the policy document and other official pronouncements that Ghana seeks to leverage its gas potential to achieve energy sufficiency and security.
Crucial to the development of the infrastructure to harness the country’s gas resources, was financing. The Ghana National Petroleum Corporation was therefore tasked by the government to find partners and the most efficient financing arrangement to develop the country’s gas transportation and processing infrastructure. After what appeared to have been a long fruitless search, the then President of the Republic, the late Prof. John Evans Atta Mills, during the second quarter of 2011, set up a National Gas Development Task Force, chaired by Dr Kwesi Botchway, to work-out a road map to the development and utilisation of associated gas from Ghana’s Jubilee oil field as well as other gas reserves in Ghana’s offshore zone.
The taskforce in their final report recommended an early phase of gas harvesting and processing, which if implemented expeditiously, would enable the evacuation and treatment of associated gas from the Jubilee Field production.
Based on the committee’s advice, the government established a wholly state-owned limited liability company to execute the project, with financing arrangement tied to a US$3 billion Chinese Development Bank facility meant largely for infrastructure projects and for developing the country’s agro-export capabilities.
The Ghana National Gas Company was incorporated on July 27, 2011 under the Companies Code, 1963 (Act 179) as a limited liability company, wholly owned and solely financed by the Government of Ghana.