Business News of Monday, 3 November 2008

Source: africa.reuters.com

Nigeria-Ghana gas pipeline to start next month

A pipeline connecting Nigeria's natural gas supplies to Ghana is expected to begin operation in December, a senior official with the Nigerian Gas Company said on Monday, nearly a year behind schedule. The $620 million West African gas pipeline, operated by U.S. oil major Chevron Corp., is considered key in easing chronic power shortages around West Africa.

"We should complete the clean up of the pipelines by the end of the month and begin to provide 30 million cubic feet per day (mcfd) of gas to Ghana from December," Sam Ndukwe, the pipeline's budget coordinator for the Nigerian Gas Company, said on the sidelines of an industry conference.

Ndukwe estimated natural gas shipments through the pipeline will increase to 130 mcfd by December 2009.

Nigeria, with the world's seventh-largest gas reserves, will export from the Itoki terminal in southeastern Nigeria to the western Ghanaian port city of Takoradi. It will also provide gas to Benin and Togo.

Nigerian National Petroleum Corp, Shell, Ghana's Takoradi Power Co., Societe Togolaise de Gas and Societe Beninoise de Gaz are shareholders with Chevron in the project.

The pipeline had originally been scheduled to start operating last December, but was delayed after leaks were detected in supply pipelines in Nigeria which needed cleaning and repair.

Some industry officials also attributed the delays to political pressure to keep more of Nigeria's gas for its domestic market.

Nigeria President Umaru Yar'Adua has faced growing criticism that he has not done enough in the last year to solve the country's power crisis, considered one of the main brakes on economic growth in Africa's most populous country.