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Ghana opts for bridge financing as Chinese funds delay for gas project

gas-pipelineGhana is now resorting to bridge financing to fund the gas infrastructure at Atuabo in oil-rich Western Region, Finance Minister Seth Terpker has said.

The gas project was expected to have been completed last quarter of 2012 but it has been rescheduled to this year due to financing challenges.

Chinese contractor, Sinopec, has been pre-financing the project ahead of the disbursement of a $3 billion loan facility from the China Development Bank (CDB).

But the disbursement from CDB is not forthcoming and that has led President John Mahama to direct both the Finance and Energy Ministries to look for a bridge financing which is usually on short-term basis for the project.

“His Excellency has asked the Finance Minister and the Energy Minister to look for additional bridge financing for the gas project,” Mr Terpker told CitiFM today June 26, 2013 in an interview monitored by ghanabusinessnews.com.

According to the Finance Minister, as far as the gas processing plant is concerned, bridge financing is not new since Sinopec has been pre-financing the project.

Mr Terpker said President Mahama has also given a directive to continue negotiations with the CDB in respect to the amendment of the contract.

The gas infrastructure, Ghana’s first when completed, include a 150 millions of standard cubit feet per day (MMSCFD Gas Processing Plant, a 36-­kilometre shallow water offshore pipeline from the FPSO to the Plant, a 120-­kilometre onshore pipeline from the gas processing plant to Aboadze, a 75­kilometre onshore pipeline from Esiama to Prestea, a jetty for the export of natural gas liquids and an operations and control office complex.

By Ekow Quandzie

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