Domestic gas can insulate economy against future shocks
The country could significantly boost its energy security and reduce heavy reliance on imports by prioritising domestic gas, Dr. Joseph Essandoh-Yeddu, an energy expert, has said.
Currently, domestic gas is primarily used for power generation, but he said with the abundance of untapped gas resources, steps should be taken to incentivise investments in gas’ other uses in the fertiliser, paint and cosmetics industries.
This, along with local processing of liquefied petroleum gas, if prioritised, he noted, has the potential to cushion the economy against future international fuel-induced external shocks, in addition to creating jobs.
“Power generation is just one aspect of gas. There are many uses for gas, like paint, fertiliser and cosmetic production. If we can find a way to promote paint and fertiliser production, it will go a long way to cushion the economy against some of the external shocks we are seeing.
“At the end of the day, we will also employ more people, along with many other benefits to the economy,” he said.
Dr. Essandoh-Yeddu spoke at the Offshore Africa Energy Summit 2022 in Accra, and said it is high time the requisite infrastructure was put in place to process LPG locally.
In 2021 alone, total LPG consumption was 345,478 metric tonnes, out of which over 85 percent was imported, according data by Institute for Energy Security.
In monetary terms, the country spent US$190million on LPG, with about US$162million of the amount going into imports.
The amount, Dr. Essandoh-Yeddu, who is Lead Technical Partner for UNEP Project on Electric Vehicles and Climate Smart Agriculture, lamented, could go a long way to strengthen the cedi and improve the country’s foreign reserves position if local processing of LPG can be prioritised.
Infrastructure, ready market can accelerate investments in gas
Asked what can be done to optimise domestic gas, Theophilus Ahwireng, Managing Director of MODEC Production Services Ghana, said the right infrastructure and a ready market can stimulate investments in the sector.
“The infrastructure needs to be in place, the market needs to be there to be able to stimulate the right investments, typically long-term. If these things are not there, it makes it difficult for you to get the investments,” he added.
Explaining further, he said: “When you find oil, it is transported easily, but gas is not transported that easily. You need a market for it; and so, the market for domestic gas is a very powerful enabler for investments in the industry, and as you know, it is a transition fuel – it is clean compared to heavy oil, and it is good for the environment. It also has multiple uses.
“So, for us to continue having investments in oil and gas, we need to do all we can to monetise domestic gas.”
Failure to do this, he warned, can stifle investments and growth of the industry.
Offshore Africa Energy Summit 2022 was organised by Jurbert Communication Limited, publishers of Offshore Africa – an oil and gas magazine. It was themed: ‘Business Drivers and how they Are Shaping the Future of Energy Delivery and Investment Returns’.
