• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Business Energy

‘Take or Pay’ Sankofa gas contracts adding $500 million to energy sector debts annually – Report

4 years ago
in Energy, highlights, Home, home-news, latest News
2 min read
0 0
0
142
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

An estimated $500 million in liabilities or debts is being incurred by the country’s energy sector due to ‘Take or Pay’ contracts signed between Government of Ghana (GoG) and International Oil Companies (OICs) for gas production from the Sankofa oil field alone.

According to a report by the Ghana Chamber of Bulk Oil Distributors (CBOD), the debts would have been more if not for the force majeure currently in place over signed contracts for gas imports from Nigeria which are also on a ‘Take or Pay’ basis.

“Maximizing the utilization of domestic gas will ensure that the liabilities under the “Take or Pay” contracts are lessened which, for Sankofa gas alone, amounts to over US$500 million per annum,” stated the CBOD in its 2019 Ghana Petroleum Industry Report .

“Imports from Nigeria, which like the Sankofa (OCTP) contract is governed by Take or Pay clauses, but not being enforced due to a force majeure declared by N-Gas (VRA’s gas supplier) since 2013. It is against this background that, we are of the view that further commitment to gas supplies from external sources will only worsen the current financial woes of the sector, especially when the force majeure on the West African Gas Pipeline (WAGP) is finally lifted,” added the CBOD in the report.

Ghana’s energy sector debt is projected to swell to $12.3 billion by 2023.

Based on current infrastructure, Ghana has a minimum domestic gas supply capacity of about 340mmscfd against a current gas demand of about 320 mmscfd.

This implies that Ghana’s total domestic demand for gas is covered by gas production from the three oil fields with an excess supply of 20mmscfd. However, government still imports gas from fellow West African country, Nigeria.

RelatedPosts

Senyo Hosi Writes: So Long, My Friends

IPR Ghana Mourns Victims of Military Helicopter Crash

Oil Prices Set for Dramatic Weekly Drop on Tariff Fallout

The import of gas from Nigeria government has argued, is to cater for an increase in gas demand for electricity generation in the medium term – 2020 to 2024.

But CBOD in its report also argued that government’s projection of gas demand for grid and off-grid uses in the medium term does not correspond with the contracted supply of gas within the period under review.

In line with the Ministry of Energy’s policy to establish natural gas as the primary fuel for power generation in the long term, natural gas is gradually becoming the backbone of the country’s power sector.

Towards the end of 2019, over 65 percent of the country’s power-generation requirement was met by natural gas. As a result of its importance to the power sector, any disruption to the gas value chain poses dire consequences for the power sector.

The power crisis experienced between 2013 and 2015, as a matter of fact was largely attributed to the non-availability of gas from Nigeria.

CBOD in the report, urged government to enhance the consumption of more domestic gas, in addition to minimizing the burden of Take or Pay liabilities to maximize oil revenues for the country.

It is also recommended that government explores the opportunity of gas exports to other West African neighbours, such as Cote d’ Ivoire, Togo and Benin.

Source: norvanreports
Via: Snr Fuaad Dodoo
Tags: energy sector debtgas productionGhana Chamber of Bulk Oil Distributors (CBOD)Sankofa oil fieldTake or Pay gas contractsWest African Gas Pipeline (WAGP)
No Result
View All Result

Highlights

Manchester United Unveils £50 Million Upgrade to Carrington Training Complex Ahead of New Season

Formula 1’s Wild 2025 Season: Seat Swaps, Dramatic Comments, and Historic Podiums

Aircraft Age Not a Factor in Fatal Z-9EH Crash, Says Bright Simons; Cautions Against Rushed Military Aircraft Procurement

US Slaps Tariffs on 1-Kg, 100-Oz Gold Bars

CDD-Ghana Mourns Victims of Military Helicopter Crash, Calls for Thorough Investigation

Tribute from CUTS International: “These Men Are Worth Our Tears”

Trending

Features

Senyo Hosi Writes: So Long, My Friends

August 8, 2025

Senyo Hosi Writes: So Long, My Friends Hon. Omane Boamah and Hon. Murtala Mohammed were both colleague...

IPR Ghana Mourns Victims of Military Helicopter Crash

August 8, 2025

Oil Prices Set for Dramatic Weekly Drop on Tariff Fallout

August 8, 2025

Manchester United Unveils £50 Million Upgrade to Carrington Training Complex Ahead of New Season

August 8, 2025

Formula 1’s Wild 2025 Season: Seat Swaps, Dramatic Comments, and Historic Podiums

August 8, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.