Karpowership relocation saves nation millions of dollars

Dotsey Koblah Aklorbortu Aug - 23 - 2023 , 19:33

The relocation of the Karpowership Ghana to Sekondi in the Western Region to use natural gas from the oil fields has saved the country $18 million a month since 2019.

The power barge, which relied on heavy fuel oil (HFO) to fire while in Tema, now uses natural gas leading to the monthly savings.

The relocation of the barge, christened Karadeniz Powership Osman Khan, also helped to ease pressure on the government to utilise substantially the contractual gas volumes agreed with the operators of the Offshore Cape Three Point.

It costs the government about $40 million a month for the country’s inability to utilise gas volumes, hence the relocation of the barge to rely more on natural gas.

During a recent visit by the Daily Graphic to the Karpowership Ghana, which is one of Ghana’s largest private thermal power generating companies, the managers said the generating units were functioning well and poised to continue contributions to the country’s energy mix.

In an interview with the Daily Graphic in Takoradi, after a guided tour of the Home Port in the Western Naval Command in Sekondi where the power barge is currently moored, the Communications Manager of the company, Sandra Amarquaye, reaffirmed the commitment of the company to meet the country’s power demands.

The company said it would fulfil its mandate through efficient management, coupled with the proximity of the powership to the country’s oil and gas fields.

“The plant remains reliable and efficient to deliver the required megawatts to the country,” Ms Amarquaye said.

The commitment

“We are committed to the cause to produce power to support the industrialisation drive of the country and to impact the country through our social investment initiatives and skills transfer through local content,” she said.

In June 2014, the owners of Karpowership signed a 450MW power supply contract with the country to deploy the powership to meet the high and growing demands from the domestic and industrial power consumers and to also export to neighbouring countries.

Ms Amarquaye explained that since its inception in 2014 and subsequent actual upstream operations in 2015, the company had consistently served the country’s energy needs.

The Project Manager of the company, Michelle Hazel, said the company’s operations had greatly contributed to the economy at the macro and micro levels.



Impacts

“The project, since its inception, has impacted both the macro economy of the country and the micro economies of our host communities,” she added.

Enumerating some of the items, Ms Hazel mentioned the company’s direct investment of more than $3 million into site preparation and sourcing of vendors locally as one of the tangible feats as it worked closely with the teams to deliver.

“With the company’s commitment to skills transfer and ensuring local content, we sourced many skills locally and engaged in tangible social interventions and capacity-building as part of its commitment to host country and communities,” she said.



Pre-financed

Ms Hazel added that Karpowership Ghana in the quest to save cost and support the national economy, off-took the natural gas meant for the country to help meet the country’s upstream commercial obligations.

The company also pre-financed the construction of the transmission lines at the cost of $8 million.

The powership currently off-takes the gas from the country’s offshore field processed by Ghana National Gas Company and the gas from the Sankofa fields.

In all, the powership has a total installed capacity of 470MW, out of which it delivers 450MW.



The savings

In 2015, the country approved a $7 billion investment in the Offshore Cape Three Point (OCTP) oil field to achieve energy self-sufficiency by utilising its natural gas for power generation.

The development of the multibillion-dollar OCTP was aimed to address the power challenges and unreliable gas supply from Nigeria, supporting sustained economic growth.

The World Bank provided a $700-million security package to ensure project success, with a focus on generating hundreds of megawatts of power from the gas.

The presence of the Karpowership Ghana, therefore, saved the country the monthly take-or-pay obligation of $52.9 million after it took action to relocate the plant and made the most of the gas resources.

The country was at the time encountering difficulties in utilising the planned 171-mmscf of gas per day from the OCTP project due to perceived inadequate planning and misaligned infrastructure investments.