Who: The government of Ghana; Electricity
Company of Ghana (ECG) – Ghana's electricity transmission
company; Karpowership Ghana Company Limited– subsidiary of
Turkey's Karadeniz Holding
What & When: Reports suggest that
negotiations are in their advanced stages between Turkey's
Karpowership and ECG for the Turkish power firm to supply Ghana
with 225MW more than originally agreed. This follows on from the
signing of a ten-year Power Purchase Agreement (PPA) between
Karpowership and ECG in June 2014 for the former to provide two
power barges, each with a capacity of 225 MW, at an estimated cost
ofUS$1 billion1. The first power barge which had a
generation capacity of 225MW arrived in Ghana's ports in
November, 2015. The project which was labeled, "Power of
Friendship for Ghana" was the first of its kind in
Africa2. However, since then, in view of the chronic
power shortages in Ghana, negotiations have progressed to the
extent that Karpowership may well add a further 225MW of power to
the second barge, which would bring total power to 675 MW. If
negotiations prove fruitful for ECG, the second 450MW barge is
expected to arrive in Tema, Ghana, by November, 2016.
Why: According to the Finder newspaper, this
agreement, among others, was signed to find a solution to the
dismaying power outages in the country. Karpower was contracted
because aside from generating power at the lowest cost, there is a
reliable supply of Heavy Fuel Oil (HFO) needed to power the ships
from the Ghana National Petroleum Company (GNPC)3.
Outlook: If the negotiations go in ECG's
favour, it would mean that 220 MW will go some distance towards
alleviating the country's chronic power crisis, but not far
enough. According to the Volta River Authority, Ghana country
has dependable capacity of 1915MW but requires between 2800MW and
3000MW to comfortably meet both domestic and commercial needs. They
say that drastic times call for drastic measures and when homes and
businesses are experiencing power outages sometimes of up to three
or four times in a day, it is clear that Ghana has returned to the
darkened days of Dumsor, thus an urgent solution is
required. However, the Karpowership deal has not been without
criticism, not least of all from the opposition, which has
vocalised that the deal will be disadvantageous to
Ghanaians4. This raises the question as to whether the
deal will prevail, should Ghana's administration change
political hands at the ballot box in December this year.
The Nigerian Minerals and Mining Act 2007 ("the Act") was passed into law on March 16, 2007 to repeal the Minerals and Mining Act, No. 34 of 1999 for the purposes of regulating the exploration and exploitation of solid materials in Nigeria.
In this issue of Dentons South Africa Insight we address matters related to wholesale licensing in the downstream petroleum industry in South Africa and highlight certain regulatory specifics in this area in Angola, Kenya and Zimbabwe.
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