Ghana on Tuesday signed a US$7-billion agreement with two energy companies for the development of oil and gas off-shore Cape Three Points in the west of the country.
The agreement for the commencement of the Offshore Cape Three Points Integrated Oil and Gas Development was between Ghana and Italian company ENI and Dutch-owned VITOL.
President John Dramani Mahama in his remarks said the gas to be produced would provide over 1,100 megawatts of power, more than what the biggest energy generating unit in Ghana, the Akosombo hydroelectric dam, is able to produce. The dam generates 1,020 megawatts of power but this depends on the inflow of water.
It is expected that the project will produce some 170 million cubic feet of gas per day for power generation.
The signing comes after a negotiating team made up of officials of the Ministry of Energy and Petroleum, Ministry of Finance, the Ghana National Petroleum Corporation (GNPC), VITOL and ENI Exploration, operators of the offshore Cape Three Points (OCTP) block, concluded talks to allow ENI commence production.
“It is simply the largest investment in Africa in this particular year… a landmark event in the development of oil and gas,” President Mahama said.
“We expect that this field’s viable life should last between 15 and 20 years,” he added.
The agreement was signed as Ghana struggles to increase its power generation to meet demand and end a debilitating power rationing programme.