Business News of Monday, 5 February 2018

Source: thebftonline.com

VRA to rely on Ivorian power to avert ‘dumsor’

The Volta River Authority (VRA) is to import about 200 megawatts of power from neighbouring Cote d’Ivoire to augment local production and avert power rationing, otherwise known as ‘dumsor’, following shutdown of the Jubilee FPSO on February 1, 2018 for planned maintenance.

The Jubilee Floating, Production, Storage, and Offloading (FPSO) produces oil and gas offshore Cape Three Points in the Western Region. The gas is then piped on-shore to the Ghana Gas Company’s gas processing plant at Atuabo.

The commodity is then processed and supplied to thermal plants sited at the Aboadze Power Enclave for thermal power production.

Shutdown of the FPSO is therefore expected to affect power supply from the Western Enclave, a situation the VRA believes will be averted with additional imports from La Cote d’Ivoire and running power turbines at Aboadze on Light Crude Oil (LCO).

“We will operate up to two turbines on Light Crude Oil (LCO) in combined cycle mode to generate up to 300MW from Aboadze to support the system.

“In addition, VRA will receive on demand up to 200MW of power from La Cote d’Ivoire to complement generation,” the VRA said in a statement issued last Friday.

The current installed capacity of the country stands at about 4,500megawatts, while demand is about 2,100MW.

The current shutdown is expected to last till February 21, 2018. Another shutdown of the Jubilee FPSO is expected in March, with yet another expected later in November.



Efforts to solve legacy problems in the sector

When the Akufo-Addo-led government assumed power, the legacy debt in the energy sector was estimated at some GH¢10billion.

Government, to address this challenge and free the sector of debts and enable it to run efficiently and profitably, has established a special purpose vehicle, ESLA Plc, that issues long-term bonds to resolve energy sector debts owed to banks and trade creditors.

The securities issued by this entity are backed by a component of the Energy Sector Levy Act (ESLA) receivables.

Government last year raised some GH¢4.7billion, using ESLA Plc to settle part of the legacy debts in the sector. An additional GH¢6billion is expected to be raised in March to clear the bulk of the GH¢10billion energy sector debt.

VRA’s Board Chair, Kweku Andoh Awotwe, told the B&FT that the action is necessary to make the utilities viable again. “The idea is definitely raising the money to solve 90 percent or the bulk of our problem, with the idea that once that is done the utilities will be in a strong enough place to take the rest by themselves. The point is, let’s help you get to a point where you can stand on your own,” he told the B&FT in an interview.