(Reuters) – The West African Gas Pipeline Company (Wapco) said on Tuesday it had suspended the flow of gas from Nigeria to Ghana over unpaid bills by the Ghana government.
Ghana’s state power producer Volta River Authority owes Nigeria’s N-Gas around $180 million, while N-Gas in turn owes the Pipeline Company $104 million, Wapco spokeswoman Harriet Wereko-Brobby said.
She said it was the first time the pipeline, a public-private partnership in which a Chevron subsidiary has a 36.9 percent stake, has been closed over non-payment.
Energy supply is a critical issue for Ghana’s government in the run-up to what is likely to be a closely contested election in November. For years regular blackouts have angered voters and this year power price rises have risen steeply.
Ghana is working to lower inflation and bring down its budget deficit under a programme with the International Monetary Fund that aims to resolve a fiscal crisis brought about in part through government overspending.
Only a small portion of Ghana’s energy needs were supplied through the pipeline, but the suspension is likely to exacerbate power supply problems given low water levels at the main hydro plants. This in turn could force the government to rely more heavily on imported gas.