Ghana benefits from making gas deposits bankable

Using the resource for local power generation is a much more efficient way of capitalising on its abundance

Rather trhan exporting gas, Ghana will use it for creating electricity at home. Reuters

New gas discoveries are commonplace across Africa these days but monetising the resource is difficult – which is why some countries are now using it for local electricity, rather than seeking to export it.

This is a practical way to make gas deposits bankable, while also helping to close the energy deficit that most countries on the continent experience.

Victor Mallet, sales director for US based APR Energy says small, quick to install gas plants are increasingly being deployed to countries that have plenty of gas but are starved for electricity.

“One example of gas’ potential in Africa is in Ghana, where the country’s massive Sankofa development is expected to start production this year," Mr Mallet says. It will provide around 2,000 megawatts of generation capacity to Ghana’s power grid, enough for around 20,000 homes.

The plants deployed can be set up in a matter of weeks, a big advantage over conventional power plants that can take years to construct. Instead, gas plants are up and running in under 90 days for the most part.

The speed at which these plants are installed is especially useful for countries that struggle to raise the large sums of capital needed over the years of building a conventional coal, hydro or even nuclear power station.

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“In countries where construction of permanent generation is delayed due to lack of funding, such as Rwanda, bridging power provided by mobile fast-track power generation can stimulate immediate economic growth, contributing to the country’s GDP and creating revenue to invest in long-term power solutions,” Mr Mallet says.

Part of the success of this strategy is that it depends on simple technology that is shipped in containers that are slotted into place, similar to Lego blocks. In APR's case, jet-engine-like turbines are hooked up to the gas network and can be fired up almost instantly.

Aggreko, a Scotland-based company uses reciprocating engines that can run on diesel or gas. In 2015 the company set up a 110Mw plant in Southern Mozambique in five months. A fleet of gas-fired generators was connected to a nearby pipeline that ran between Mozambique's offshore gas fields across to South Africa.

A report published by Ernst & Young Global Limited notes that gas consumption in Africa has been increasing at a rate of about six per cent a year over the past two decades. Traditionally North Africa was the continent's source of oil and gas, but discoveries south of the Sahara have changed the picture substantially.

The Democratic Republic of Congo, Mozambique, Rwanda and Sudan have emerged as viable LNG producers. The report, Natural Gas in Africa, also notes that oil’s dominance in West Africa is gradually giving way to gas, while East Africa’s gas sector has progressed from virtually non-existent to the so-called “next epicenter” for gas production in just 10 years.