China’s Sinopec Threatens to Abandon $700m Ghanaian Gas Project

China’s Sinopec Threatens To Abandon $700m Ghanaian Gas Project
Ghana’s Jubilee oil field

AFRICANGLOBE – Chinese firm, Sinopec International Petroleum Service Corporation is threatening to abandon works on Ghana’s Gas infrastructure due to the country’s inability to make a refund to it.

The Gas infrastructure which is being constructed in the Western Region of Ghana is supposed to be funded from a $3 billion loan from the China Development Bank (CDB) but the start of work was pre-funded by Sinopec. The infrastructure also includes a gas processing plant.

But the Ghana National Gas Company has revealed that Sinopec has served notice to leave the project site due to Ghana’s commitment to pay back.

Disbursement of the CDB loan to the Ghanaian government has encountered some challenges which has resulted in slow remunerations.

Speaking to journalists at a gas forum in Accra on Wednesday, CEO of the Ghana National Gas Company George Sipah-Yankey revealed that: “The President (John Mahama) sent a team to China to discuss the issue with CDB and they have come back. We are still in the resolution stage now and we’ve had some warnings from Sinopec that in the event that there are further delays of payment then they will not be able to proceed.”

“In fact they wanted to suspend work this week but after some discussions with them they are now working and we hope that we can resolve the issue before they suspend work again”.

It was also revealed that Ghana’s Ministry of Finance has begun working on the matter to settle some of the bills.

Dr. Sipa-Yankey was however hopeful that if work continues without any break, certainly before the end of this year the Ghana gas project should start commercial operations.

The $700 million gas infrastructure project will process gas from the Jubilee Field for power generation. The facility is expected to process about 150 million standard cubic of gas a day.

 

By: Nana Boakye-Yiadom