Africa Oil & Gas: Nigeria denies reports on cuts for gas supply to Ghana

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Image courtesy of Nigeria LNG

Reports that Nigeria has reduced gas supply to Ghana because of the latter’s debts have been denied on the Nigerian side, who say it’s down to commercial negotiations.

West African Gas Pipeline Company (WAPCo) operations chief Austine Ebekozien told NGW April 9 that there’s been a misconception about Nigeria reducing supplies to Ghana due to its $40mn debt.

He has said he is unaware of gas supplies to Ghana having been reduced. Instead he argues that supplies are down to a contractual agreement between N-Gas – a joint venture of NNPC, Shell and Chevron that is the main seller of Nigerian gas through the West African Gas Pipeline (WAGP), Ghana’s main state power producer Volta River Authority (VRA), and WAPCo which operates the WAGP.

“The terms of agreement has nothing to do with both countries but between NGas and consumers on the value chain. Although WAGP is still owed [fees], we are still supplying gas to our consumers, if we are required to ship a certain amount of gas to consumers and are mandated to do so,” said Ebekozien. The issue of debt is still being negotiated between concerned parties, he added.

Last week it was reported that, since the start of 2018, Nigeria had been sending about 60mn ft3/d to Ghana through the West Africa Gas Pipeline Company, so about half the agreed 123mn ft3/d when WAGP was completed in 2011 and that this was due to VRA’s incapacity to pay off its debts toward N-Gas. Apart from the debt, vandalism of pipelines on the Nigerian side of the border, and a continuing shortage of gas for Nigerian power plants, were cited as reasons for the apparently reduced deliveries.

“We are at about half of what we have been contractually promised, which is not good enough. There are many reasons for that; the vandalism of pipelines and the fact that we have not paid our bills,” said VRA board chairman Kweku Andoh Awotwi, indicating there were ongoing talks to increase the daily supplies to 90mn ft3/d.

Every now and again, authorities in Nigeria and beyond talk of expanding WAGP westward to Cote d’Ivoire or even 5,000km around the African coast to Morocco. Such plans however remain pipedreams while the basic capacity of WAGP remains under-used. source:NGW

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