Recent plans regarding a natural gas plant that has been long-delayed over the years could be the stepping-stone that may transform Ghana's economy. The president, John Dramani, has announced that he believes the construction of such a facility will be more beneficial and crucial to the economy of Ghana than even an oil discovery.
The plant will be in a village along the west coast of Ghana, called 'Atuabo'. It is expected to open in December of this year, capable of producing at least 500 megawatts of electricity. The power production is estimated to assist in saving the treasury of Ghana approximately $500 million each year in costs since they will no longer have to import so much crude oil.
Furthermore, hopes have risen that the plant will be able to help boost oil production within the country, reducing the number of power outages that have been plaguing the nation. The change should provide a vital improvement to Ghana's struggling economy. The president suggested that the arrival of the new plant could:
* Create more jobs for local residents
* Improve the security of Ghana's energy
* Enhance the potential of Ghana's economy
Ghana is in need of Economic Help
Although it is located within the turbulent area of West Africa, Ghana's democracy is uncommonly stable. The country produces cocoa and gold regularly but it does need some assistance in restoring the flagging fortunes of the economy. Throughout the years, a 10.1% budget deficit and dropping prices in commodities has led to the increased prices for businesses and consumers.
The country has begun to lose a sufficient amount of its appeal. Compared to the dollar, the currency of the realm has plummeted downwards. Circumstances have become so bad that the president recently had to approach the International Monetary Fund for support.
The Importance of this Gas Plant
The financial worries of the government have had a serious effect on the oil sector, which had been lauded for its significant power in transforming the country before the president's election. The issue has been that Ghana is incapable of processing the gas that bubbles naturally along with its crude oil, causing frustration in efforts to improve the economic circumstances. Because there was no way to handle the natural gasses that occurred as a result of producing the oil, making more than 100,000 barrels per day would have been illogical and certainly dangerous.
In response, construction began on the gas plant facility, and since then, several deadlines for its opening date have been missed.
Analysts suggest that the production of a more reliable center for power could have a significant impact upon the restoration of confidence in Ghana's economy. Last year, Ghana was spending over one million dollars a day on costs to keep its power plants turning, and as a result, blackouts had been sweeping the country. This only damages productivity across every organization including government agencies, mines, and companies. This is why so many generators are being used in Ghana because the power is unreliable. The problem is that generators are expensive to run.
This sucks away money from every entity in Ghana because so many resources have to be spent on energy costs.