There are strong indications that government will soon give its assent to the Jubilee operations following the conclusion of all licence negotiations with the field development partners, thereby putting to rest months of speculations about the fate of Jubilee.
With negotiations successfully concluded, last week, " ... there is no reason for any delay in the [Energy Minister] appending his signature," Deputy Energy Minister Dr. Kwabena Donkor told the international press on the sidelines of the Africa Energy Week conference in Cape Town.
Field development operations of Ghana's 1.8 billion barrel Jubilee field is being fast-tracked by partners including Tullow Oil, Kosmos Energy, and Anadarko Petroleum to meet targetted production of 120,000 barrels daily by end of 2010.
There were concerns that difficult negotiations over utilisation and monetisation of associated gas from Jubilee operations, as well as environmental concerns, which led to over six months delay in approval of field development plans, could undermine plans to• pump first oil in 2010.
Ghana's current law is clear that the gas associated with the Jubilee oil field development belongs to the consortium led by Kosmos and Tullow.
Ghana's Energy Minister, Dr. Joe Oteng-Adjei, however said "gas is the commodity that offers the fastest means of transforming our economy and must be integrated with the power sector."
The minister has disclosed that a full raft of legislative reform packages, which would be ready for consultation by the end of the year, will include legal and policy formulations affecting the upstream oil and gas, renewables and power sectors.
Under initial talks, Jubilee field operators offered to sell associated gas, to government, at US$4 per cubic foot, but after further talks agreed to supply the first 200 billion cubic feet (bcf) to government gratis under phase one of the Jubilee development, but will charge market value for phase two.
Dr. Oteng-Adjei acknowledged this is goodwill to assist government in funding the necessary gas infrastructure to pipe Jubilee gas to Effasu in the Western Region, where the Ghana National Petroleum Corporation's (GNPC) 140-megawatt Osagyefo barge-mounted turbine is located.
While Jubilee field partners, in collaboration with GNPC, are working to ensure the earliest possible first-gas exports, the floating production, storage and offloading vessel (FPSO) expected to arrive in Ghana by early 2010 will have the capability of injecting back into the wells, 100 percent of produced gas, to avoid any delay to the first oil.
Ghana, meanwhile, is still seeking to be the major shareholder in the estimated US$1 billion needed for the Jubilee gas development plans and despite a US$375 million funding expected from the World Bank, the country still needs more.
Foreign Minister, Alhaji Mohamed Mumuni, hinted that the country would take advantage of US President Obama's visit to seek American private sector participation in the Jubilee gas operations.
Jubilee field operators initially planned for US energy producer and supplier, Sithe Incorporated, to utilise the expected 120 million cf daily gas output from Jubilee operations in the production of electric power for multinational mining concerns in the Western Region.
Source: B&FT
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