The Energy and Green Transition Minister, John Jinapor, has revealed that Ghana could save up to $400 million annually if it had established an additional gas processing plant.
Ghana currently operates a gas processing plant at Atuabo, managed by Ghana Gas. However, to address the country’s energy shortfalls, the Cabinet has approved plans for the construction of a second gas processing plant.
Speaking before Parliament, Mr. Jinapor stated: “If we had established the gas processing plant earlier, we could be saving $400 million annually. By processing domestic gas, we strengthen the currency, ensure fuel availability, and provide consumers with cheaper alternative energy sources.”
He underscored the urgent need for interventions to enhance energy security and stabilize power supply.
Strategy to tackle energy challenges
The Cabinet has approved a set of short-, medium-, and long-term measures to address the country’s energy challenges. A key component of this strategy is partnering with the Finance Ministry to accelerate the construction of a second gas processing plant. This new facility is expected to bridge supply gaps and enhance energy security.
High Electricity Costs and Fuel Mix challenges
Mr. Jinapor highlighted that Ghana’s electricity costs are rising due to the expensive fuel mix. The country previously received free foundation gas from the Jubilee oil field, but that period has ended, requiring payments for gas.
Additionally, incremental gas costs are high, cedi depreciation increases expenses, a diversified energy mix is needed to lower costs.
To address these issues, the government plans to construct a second gas processing plant, ensuring a more stable energy supply. Ghana is expected to spend $800 million on liquid fuels in 2025 alone, reinforcing the need for a cost-effective energy solution.
Diversifying energy sources
Mr. Jinapor stressed the importance of renewable energy as part of Ghana’s energy mix. While initial investments in renewables may be high, they become cheaper over time when amortized. He also highlighted the need for consumer education on efficient electricity usage.
Ghana has faced recurring power supply challenges due to increasing demand and limited gas processing capacity. The proposed second gas processing plant will complement existing infrastructure, improve natural gas supply reliability, and enhance power generation capacity.
