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US-based General Electric and its partners, Endeavour Energy and Finagestion, have signed a joint development agreement for the Ghana 1000 project
The project aims at adding 1,000MW of thermal power to Ghana's installed electricity capacity, the company said.
The agreement was signed by General Electric's vice-chairman, John Rice, Finagestion's chairman Vincent Le Guennou and CEO of Endeavour Energy, Sean Lang. Also present at the signing ceremony was Ghana’s deputy minister for energy John Janakpor.
The first phase of the project, which will initially produce 360MW in simple cycle mode, is expected to begin delivering power by early 2017. At completion, it will generate more than 540MW in combined cycle mode, said the partners.
The second phase, they said, will be implemented before 2019 to create one of the largest single power parks in sub-Saharan Africa.
"The first phase of the project alone will require more than US$20mn of development capital, over US$200mn of equity from the project sponsors, and more than US$600pn in debt financing," said Jay Ireland, CEO and president of General Electric Africa.
The over-US$1bn project, includes a floating storage and regasification unit to facilitate importation of Liquefied Natural Gas (LNG) for power generation.
The importation of LNG as part of the project will cut out the challenge the country currently has of having generation plants without gas to power them.
The use of LNG is also expected to reduce the cost of generation as compared to light crude oil.
“The Ghana 1000 Project will be unique as an liquefied natural gas-to-power project completed in an emerging market and is important to Ghana because it will both add reliable, baseload generation as well as help to lower the cost of power in the country when compared to plants currently running off expensive light crude oil,” said Sean Long, CEO of Endeavor Energy, an Africa-focused developer and operator of thermal and hydroelectric power projects.
Finagestion is an African utility sector operating group controlling several concessions in water and electricity sectors in Côte d’Ivoire and Senegal. Finagestion is a portfolio company of Emerging Capital Partners (ECP), a pan-African private equity firm and will assume a key role as part owner and operator of the facility and be part of the Ghana 1000 consortium.
“This is the first time such quanta of power will be produced from a single location in sub-Saharan Africa outside South Africa. The fact that we are putting 1,000MW on a single site will yield significant savings on account that the power generation units can leverage the same balance of plants parts and staff,” said Vincent Le Guennou chairman of Finagestion and co-CEO of ECP.