Parliament Debates Us$850m CDB Cash For Gas Project

Three subsidiary agreements, covering one billion United States dollars of the three-billion China Development Bank (CDB) loan, were laid before Parliament on Friday, February, 3, 2012 by Minister of Finance and Economic Planning, represented by his Deputy, Mr. Seth Terkper.

The subsidiary agreements cover an amount of US$150 Million to finance the ICT-enhanced Surveillance and Monitoring Facilities for the Oil and Gas Enclave and US$850 Million to finance the Western Corridor Gas Infrastructure Development Project under the Master Facility Agreement (MFA) between the Republic of Ghana and the China Development Bank (CDB), which was approved by parliament in August 2011.

The third subsidiary agreement is an Offtaker Agreement between the Ghana National Petroleum Corporation (GNPC) and the Asia Company Limited, also under the MFA between Ghana and the CDB. The presentation of the subsidiary agreements covering the US$1,000,000,000 was the second time as it had earlier been presented en bloc but had to be withdrawn following demands by Parliament that it was separated.

Parliament is expected to commence deliberations on the agreements this week and approve them in order to enable an early draw down on the facility, which will enable an acceleration of the gas infrastructure project that will process and transport natural gas, from the Jubilee Field, initially for power generation and other industrial uses.

The Ghana National Gas Company (Ghana Gas), a fully-owned state organisation under the Ministry of Energy, is the implementing agency.

Ghana Gas has already engaged Sinopec International Petroleum Service Corporation of China, after it signed a Project Implementation Agreement with it in mid-November, under which the latter is responsible for the Engineering, Procurement, Construction and Commissioning (EPCC) of the 150 MMSCFD Gas Processing Plant.

Source: Business Analyst