Lonrho plans $1 billion investment in build of oil services ports in Ghana
LAF plans to build a series of ports to support the firm's oil rigs in Ghana's Western Region
Lonrho Plc (LAF) is planning to invest US$1 billion in the construction of a series of ports on Ghana’s Western Region to aid in the service of the company’s oil rigs.
“We anticipate spending $10 million for feasibility studies for the deep water oil services ports,” Steven Gray, LAF’s Development Director, told Bllomberg.
“The studies will end in August and if that demonstrates viability and sustainability then construction will start by the last quarter of this year.”
Initial studies note that Ghana’s oil and gas industry is in dire need of supporting port infrastructure, with a “number of potential tenants and users” showing interest in “Ghana as a regional hub for their oil and gas operations,” added Gray.
In the first phase of the country’s dedicated oil and gas port upgrade, the West African country plans to invest $400 million. Further funds of up to $1 billion will be made available if necessary, said Gray.
The development of ports in Ghana’s Western Region was agreed in August last year, signaled by the signing of a memorandum of understanding between LAF and the Ghanaian government.
The project will be executed over a concessionary period of 50 years, added Gray.
Ghana, who only began exporting oil five years ago, expects to increase its oil output fivefold over the next five years, said Ghana’s Deputy Minister of Finance and Economic Planning, Fifi Kwetey.
The Jubilee field, Ghana’s primary oil field, pumps about 85,000 barrels of oil a day, with the field’s operator Tullow Oil Plc planning to increase its total production to 120,000 per day from 2013.