Wednesday, April 13, 2011

Ghana To Get Another Oil Refinery

New Alpha Refinery-Ghana, a South African-initiated company, is to construct a second crude oil refinery in Ghana. The project comes with import/export facilities; a tank farm and a gas turbine.
The refinery will have the capacity to process 200,000 barrels of crude per day.

This would be more than quadruple the capacity of the Ghana’s lone refinery - The Tema Oil Refinery (TOR) whose output is just about 45,000 barrels per day.

The decision to locate New Alpha Refinery in the Western Region of Ghana has been lauded by industry experts as timely in the wake of the country’s discovery of oil in commercial quantities.
B&FT gathered that the government through the Ministry of Energy and the National Petroleum Authority is providing any support necessary for the project to take off smoothly prior to Christmas.

Officials of the company are tight-lipped on the cost of the project.
New Alpha Refinery’s executive chairman Merlyn Julie said in addition to the refinery, terminal and tank farm, a power-generation plant will be constructed using gas turbines.

He explained that the associated gas produced with the crude oil production will be harnessed to feed the plant - for the purpose of powering not just the refinery itself, but also to generate surplus electricity to supplement the electricity requirements of the country. This is in line with the policy of government to maximize its electricity production capacity to serve not just the domestic market but also for export to neighbouring countries.

New Alpha Refinery-Ghana output will supply neighbouring countries with refined products such as gasoil, gasoline, jet-fuel and LPG among others. The South African promoters of the project are delighted with Ghana for its stability and profitability as an investment destination.

Ghana’s rising consumption of petroleum products means more imports of refined products from Europe to augment the output of the Tema Oil Refinery. With consumption levels nearing 3billion litres-a-year, Ghana’s 45,000 bpd-capacity refinery is inadequate to keep up with the trend. The construction of an additional refinery is deemed more than just welcome news: it will improve local manpower capacity for the hydrocarbon industry and create jobs.

European refineries have been running at all time high, with nearly 30 cargoes traversing the sub-Sahara African (SSA) shores on a monthly basis. Nigeria alone receives about 10 of these cargoes. Ghana’s ability to export refined products to neighboring countries will be a strategic economic venture.

New Alpha Refinery has initiated a feedstock-agreement with Nigeria and Mali to buy feedstock (crude oil) and set up an off-take agreement in return to sell the refined products to them.
According to project consultants based in South Africa, all layouts and technical issues are being concluded and the consultants are confident of a successful implementation. The consultants executed the upgrading of Chevron’s refinery in Cape Town, and still advise the refinery on ways of keeping efficient. They are also involved in big projects for PetroSA, Total, SASOL, ENGEN, and Sonangol among others.

All over Africa, similar projects in the past have either been delayed or scrapped altogether as funding became a challenge; but the project consultants say New Alpha Refinery-Ghana is all set for a sustained take-off till completion.

Officials of the company have been frequenting Ghana, meeting officials to fine-tune arrangements for the take-off. Ghana’s downstream regulator, the National Petroleum Authority (NPA), is looking forward to this project with great expectation.

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