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Atuabo Gas Project: Jubilee Partners can’t wait any longer

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After several missed deadlines on the completion of the Atuabo gas project, the Jubilee Field operators are said to be mulling the construction of a temporary bypass pipeline to feed directly Volta River Authority’s thermal plants at Aboadze.

This means instead of going through the processing plant, the gas would, in the meantime, go directly to the VRA’s thermal plants at Aboadze for power generation.

The inability of the Ghana Gas Company to make ready the gas processing plant is seriously impeding work at the Jubilee Field, with operators having to re-inject the gas into reservoirs.

The construction of the gas facility at Atuabo has suffered many setbacks and though the Ghana Gas Company says the facility would be ready by third quarter; insider information indicates that the project will not be completed this year.

A reliable source told the B&FT that operators are confident that the new deadline for the completion of the
Atuabo project would not be met, a reason they are busily considering the bypass option.

According to the source, the construction of the bypass which is expected to be pre-financed by the jubilee partners, would take at least six weeks to be completed.

The bypass, if constructed, will allow gas from the field to be sent directly to the VRA’s thermal plants, which is intended to be a major beneficiary of the uncompleted Atuabo gas facility.

Tullow Oil, operators of the Jubilee Field, currently produce about 110,000 bpd and the reinjection of gas is threatening reservoir pressure to meet the target of 120,000 bpd. With Ghana’s policy of zero flaring, Jubilee operators have been restricted to gas re-injection.

However, it is becoming increasingly expensive for the drilling of reinjection wells and the field operators have limited options to deal with the unused gas, with the temporary bypass remaining one of the most feasible options in the short-term.

Although it is not immediately known how much the project will cost, energy policy analyst, Peter John Amewu, believes that the bypass option will have a severe cost implication for the government which is already struggling to raise funds to complete the Atuabo facility.

Rather than invest in a temporary facility that will ultimately build up cost for government, Mr. Amewu said it will be prudent for Tullow Oil and co to give the money to the Ghana Gas Company to help it complete the gas plant on time.

The US$850 million Atuabo Gas project is being constructed by China’s Sinopec with funds from the CDB loan. Around 90 million standard cubic feet of raw gas per day is expected when the processing plant is completed, which could peak to around 120million standards cubic feet per day.

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Reporting Oil and Gas project was launched on 4th June 2009atTakoradi, Western Region, Ghana by Penplusbytes (PPB – www.penplusbytes.org) with the vision of providing a one stop online information and knowledge about Ghana’s oil and gas sector
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