?Resolve pipeline issues?

From Gideon Sackitey, GNA Special Correspondent Cotonou

Ghana has called for the quick resolution of outstanding issues concerning the future of the West African Gas Pipeline Project (WAGP), although feasibility studies have proved its technical viability.

The issues include the setting up of the West African Gaspipeline Company (WPCO), the determination of the nature of tax regimes and other rules and regulations, which will enable the company to determine or set tariffs among others for participating nations.Mr Fred Ohene-Kena, Minister of Mines and Energy who made the call during the historic signing of a Memorandum of Understanding with Ministers of Energy and Mines from Ghana, Nigeria, Benin and Togo, noted that the MOU confirms the consortium as project developers and establishes a legal framework for the project.

At the same ceremony, the consortium made up of Chevron Nigeria Limited, Ghana National Petroleum Corporation, Nigerian National Petroleum Corporation, Shell and Societe de Gas of Benin and Societe de Gas of Togo, also signed their joint venture agreement committing them to the project.

It also established the process to expedite project development on a commercial basis.The project developer will among others negotiate shareholding agreement of the pipeline company, funding facility secure gas transportation agreement and engineer, procure and construction agreement.

Mr Ohene-Kena who is the chairman of the Steering Committee, also called for flexibility on the part of governments with respect to direct government take and preferred project structure and regulation as one or the measures aimed at making the project succeed.

The MOU signals the kickoff of activities to develop this vital regional gas pipeline infrastructure.

Mr Ohene-Kena signed for Ghana while the other ministers signed for their respective countries.

The gas pipeline project, expected to cost approximately $400 million will initially carry about 120 million cubic feet of Nigerian gas per day to power generation customers in Ghana, Benin and Togo.

Ghana is estimated to utilise 84 per cent of the gas while Benin and Togo use nine and seven per cent each.

Mr Ohene-Kena said the project will create 18,000 jobs in the sub-region adding that Ghana, Benin and Togo, coming out of power shortages last year would want to assure themselves that such disastrous shortages do not reoccur citing fast tracking of the construction of the project as the surest and least cost option to this goal.He said even though July 1, 2002 has been fixed as the date of first delievery of gas, "this will require a very high degree of co-operation and recognition of regional rather than individual interests".

He described the roles and support of Chevron and Shell in the project so far as "promising".

The Mines and Energy Minister pledged Ghana's commitment to the project noting that " the Ghana Government will do all in its power to ensure that the project is completed on schedule".

He thanked the US Government for providing $1.5 million grant through the USAID towards the training and capacity building of professionals in the four countries in support of the project.

The Japanese Government and World Bank are also providing financial and technical assistance to the project.

Mr Felix Essou Dansou, Beninois Minister of Mines, Energy and Hydraulics described the signing of the MOU as a historic event with the potential of fostering greater integration and sustainable development in West Africa.

He said the project has moved a long way from the establishment of a steering committee, project implementation committee to the formation of the commercial group who are the implementors of the project.

He said work by the commercial group will move the project further for implementation in the next three years and enable the production of cheaper electricity for the sub-region.Mr Calvin Humphrey, Deputy US Secretary of Energy said his government is pleased with the progress of work done so far, adding that the signing demonstrates the growing spirit of regionalism in the region.

He affirmed the US government?s determination to see the project through and assured the four countries of continued US support.

"The United States is prepared to walk down the road together with you in order to bring this project alive".

Mr Humphrey said the USAID will assist ECOWAS to bring the project to being by building on their technical and institutional capacities.

Mr Lansana Kouyate, Executive Secretary of ECOWAS said the current stage of the project is a demonstration of proof that economic, social and political integration is possible in West Africa.

He expressed the secretariat's gratitude to the immense effort by the PIC and the commercial group and said the rest of the way demands even greater sacrifices by the countries involved.

A statement issued at the ceremony said the WAGP will be the prototype for inter-connection of the region, identifying and removing roadblocks that to date have hindered economic integration of the region.

It would create a productive, economically viable alternative to flaring.The MOU in Cotonou was part of steps taken since signing of the Head of State Agreement in September 1995 which set out the intentions of the four countries concerned.

The countries are to negotiate a concessional agreement on a build, own and operate basis.

The three countries, according to the World Bank, should be able to save about $500 million in energy cost over a period of 20 years when gas replaces their expensive fuels and hydro power currently used for power generation.

Besides, the new civilian government in Nigeria has pledged to give the gas pipeline project the "boost" it deserves.

According to President Obasanjo, the goal of the new administration, is to make revenue from the country's enormous gas reserves to be at par or even surpasses earnings from crude oil.

The pipeline has proposed onshore landfalls in Cotonou, Lome, Tema, Takoradi and Effasu.