Ghana’s energy sector is opened for business - Herbert Krapa to investors

Deputy Minister for Energy Herbert Krapa has called on giants in the energy sector and companies to take advantage of and invest in Ghana’s oil and gas industry for the mutual benefit of the companies and Ghana.

Herbert Krapa speaking on behalf of the sector minister Dr. Matthew Opoku Prempeh at the ongoing Global Energy Show in Calgary, Canada, on Tuesday, 14 June 2023, during a panel discussion on the theme “How Major Producers and Buyers of Energy are Building Sustainability in their Energy Strategies”.

Herbert Krapa presented Ghana’s case on how the country is affected by the turmoil in global energy markets following the Russian invasion of Ukraine.

“It is indeed true that the Russian invasion of Ukraine, which came at no worse a time than the onset of global recovery from the COVID pandemic, affected and still affecting the global energy markets and Ghana is no exception. Prior to Russia’s invasion of Ukraine, the COVID pandemic had already destroyed most economies worldwide.

Ghana being a country that is heavily dependent on the importation of petroleum products to meet domestic demand, the country did not just suffer the astronomical increments in fuel prices as a result of the invasion, but an unprecedented depreciation of our local currency and the related negative impact on other economic indicators such as inflation” he stated.

He recalled, “Globally, it is expected that fossil fuels will remain a significant component of the energy market in the long term, given the cost associated with the deployment of renewables such as solar and wind. Although the industry has seen significant cost reductions over the years, currently, renewable energy contributes only 20% to the total global energy consumption.

These unpalatable statistics, he stressed call for attention to be focused more on deploying technologies that improve energy efficiency, capture, and/or minimize carbon emission whilst simultaneously pursuing the development of renewable energy as an alternative to fossils.

"This is necessary if the net zero target is to be achieved," he added.

The deputy minister continued, "The environmental challenges facing the global energy landscape are real and keep widening in various dimensions annually."

"The energy sector players and governments, have no option than to adapt their strategies in ensuring that the impact of energy production, supply and utilization activities on the environment is minimized, whilst maintaining energy security and affordability."

"In Ghana, we have introduced the zero-gas flaring policy, even before the Paris Accord, which ensures that all produced gas is harnessed to meet our power generation and other forms industrial usage, without causing severe harm to the environment."

Meanwhile, at the COP 27 held in Sharm El Sheikh in Egypt, the President of the Republic of Ghana out doored Ghana Energy Transition Framework.

The objectives of the Framework, among many others, are:

i) identify viable pathways for the country to transition towards carbon-neutrality within a secure and efficient energy sector

ii) harness the opportunity for a fair and equitable energy transition as the country relies on carbon-intensive industries for economic growth

Some oil and gas producers in Ghana have developed their internal sustainability polices in line with the net-zero agenda. Tullow Oil Ghana Limited for example aims at deploying technologies that will lead to net zero emissions by year 2030, whilst, Eni Exploration and Production Limited has developed an action dubbed “Natural Climate Solutions (NCS)” which are initiatives for land protection, sustainable land management and restoration of natural ecosystems that increase carbon storage and/or prevent greenhouse gas emissions.

In the area of electricity generation, the deputy minister highlighted some of the state-owned generation companies that have incorporated renewable energy in their generation mix.

The Volta River Authority (VRA), he mentioned predominantly has large hydro and thermal generation company which has developed a solar energy park with a capacity of 2.5 MW located Navrongo in the Upper East Region, 6.5 MW in Lawra in the Upper West Region and 13 MW solar in Kaleo also in the Upper West Region. The company is currently undertaking a 150 MW Wind Energy project in the southern part of the country.

The Bui Power Authority, another large hydro generation company, the deputy minister noted has diversified to install 5 MW Floating Solar Panel as part of a bigger portfolio aimed at developing a 250 MW solar plant.

"The government of Ghana is also planning to introduce Compressed Natural Gas (CNG) to be used in the transportation sector to reduce the dependence on liquid hydrocarbons as the country transitions to net zero.

This shows that even as Ghana undertakes efforts to ensure its energy security, we are cognizant of the dangers associated with energy production and utilization and are incorporating environmentally responsive strategies in our development plans to mitigate the negative impacts,” he shared.

Touching on how sustainable energy can build resilience, the deputy energy minister said the model ensures diversification of energy sources and minimizes the price volatility associated with fossil fuels.

"Decentralized renewable energy generation such as solar rooftops help reduce transmission losses associated with grid generation. Furthermore, the climate benefits of sustainable energy usage minimize the environmental disasters that affect energy installations."

He also spoke on the challenges stating that "large-scale sustainable energy is the high cost associated with the installation, especially the storage units. Another issue is the amount of land size required.

For solar systems, for example, a 1MW solar farm would need between 6-8 acres of land. These are some of the factors responsible for the still low proportion of renewable energy in the total global energy mix, although the growth rates seem encouraging."

"With regards to opportunities, in addition to sustainable energy contributing to the resilience of the energy sector and emissions reduction, another area to watch out for is employment. It is estimated that by the year 2030, demand for sustainable energy workers will increase by over 340%. However, this is with the caveat that there is enough training and re-skilling of the worker population to take advantage of the job opportunities”.

In his closing remarks, Hon. Krapa assured prospective investors of Ghana’s robust legal and regulatory framework anchored on the respect for the rule of law and the high regard for democratic accountability and expressed his confidence that Ghana will impress prospective investors, if they choose to invest in its energy sector.

The Global Energy Show is North America's Leading Energy Event with the largest B2B exhibition and conference engaging with industry buyers and sellers, stakeholders and partners, CEOs and young professionals together to share knowledge and fuel innovation in the ever-changing energy landscape.

Taking place on June 13-15, 2023 the Global Energy Show is inclusive to all energy systems, including features on the exhibition floor and conference in oil sands, hydrogen, wind, solar, petrochemicals, gas and LNG, electrification and nuclear.

As no single source of energy can meet the increased global energy demand, the Global Energy Show is where Canada demonstrates its vision and leadership by bringing the right people together to meet global challenges with real-world solutions.

The show features a comprehensive exhibition show floor with over 600 exhibitors across five exhibition halls and an outdoor zone.

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