Ghana may no longer need to worry about reduced gas supply from Nigeria

Nigeria may no longer drastically cut gas supply to the Aboadze Thermal plant as the Ghanaian government has settled $10 million out of its $181 million debt, to the WAPCo and Nigeria Gas Association, NGA, following the first round of talks with the Nigerian authorities. A move which gives Ghana additional time to conclude negotiations to curtail the cut in gas supply from Nigeria.

This comes after Africa’s largest economy, which supplies Ghana with an excess of 140million standard cubic feet per day of gas, threatened to cut gas exports from Friday due to the government’s failure to settle outstanding debts to the Nigerian gas authorities.

The power sector crisis in Ghana has created considerable consequences for the emerging economy. The threat to cut supply by nearly 70 percent would definitely worsen problems for a country which already faces electricity blackouts. The supply received from Nigeria, although not enough, has greatly impacted power supply in Ghana over the last couple of weeks. Therefore both countries held an emergency meeting to discuss a payment plan which will be agreed on by other partners.

Ghana’s Minister for Power, Kwabena Donkor, led a government delegation to Abuja that began talks on Thursday last week with N-Gaz, a Nigerian consortium, and other stakeholders in a bid to avert the threat, said Harriet Wereko-Brobby, WAPCo spokeswoman.“By next week we are expecting a way forward,” she told Reuters. “There appears to be a will by all the parties to resolve the issue without the flow of gas being cut off.”

The present situation in Ghana which is characterized by huge power infrastructure gaps and consequent sketchy power supply has raised the cost of doing business. Thereby causing mistrust between voters and President John Mahama’s government ahead of a highly contended re-election battle next year.

President John Mahama made a vow earlier this year to restore power supply in Ghana, with plans to double it’s power output by 2020.  “The effect of this power crisis has affected all Ghanaians. We have been here before in 1998, 2007 and I do not intend to manage it, I intend to fix it. I John Mahama, will fix this challenge,” he asserted.

The President informed the audience that he had authorized the Ministry of Power to acquire and feed 1,000MW of emergency power into the system as an immediate measure to resolve the current crisis, adding that “guarantees are currently being agreed for 450MW from Karpower ship (Turkey), 250MW from APR (UAE) and 300MW GE.

He further revealed that the new Ministry of Power was working urgently on proposals to restructure the power sector beginning with the Volta River Authority (VRA) and the Bui Power Authority (BPA), hinting that the key objective was to bring the management of hydro plants under one entity.

In West Africa, Ghana has held its own as a nation that enjoys significant levels of uninterrupted power supply, a feat that differentiates it from the rest of the region. However in recent times that reputation has seemingly vanished as its citizens now suffer a similar fate of epileptic power.

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