BMI View: Ghana’s nascent oil and gas industry is set to undergo a transformation over the next few years as the Jubilee and Greater Tweneboa projects ramp up to full production. Appraisal of other oil and gas prospects is likely to gather pace and we expect upside risks to both our reserves and production forecasts over long term. Gas production is also likely to gather pace once adequate infrastructure is in place. This will help meet rapidly rising demand from power generation and reduce dependence on imported Nigerian volumes.
Main trends and developments we highlight for Ghana’s oil and gas sector are as follows:
.. Ghana’s reserves are likely to continue to grow at a rapid rate as the appraisal of the Greater Tweneboa, Southeastern Jubilee and West Cape Three Points prospects continues. The end-2010 Oil & Gas Journal (OGJ) annual reserves and production survey attributes 660mn barrels (bbl) of proven oil reserves to the country, but BMI is more bullish. We forecast that the country will hold proven reserves of 825mn bbl by end-2012, which we see rising to approximately 937mn bbl by 2016.
.. Production from the Tullow-operated Jubilee field continued to disappoint in Q112, producing circa 80,000 b/d due to well completion difficulties. These issues are not expected to have any impact on field resources and production is expected to ramp up gradually towards FPSO capacity of 120,000b/d, once a new development phase is complete.
.. Oil consumption is set to rise rapidly on the back of strong economic growth. We expect demand to hit an estimated 73,000b/d in 2012, rising to 95,000b/d by 2016. Higher refined product imports will therefore be required as refinery capacity remains restricted to 45,000b/d. We expect this capacity to rise to as much as 245,000b/d over the long term, but new facilities are unlikely to be brought onstream much before 2018.
.. We expect net oil exports to grow from approximately 14,000b/d in 2012 to 103,000b/d by 2016.
.. An US$3bn loan from China Development Bank is set to provide funds for new midstream gas infrastructure capacity, facilitating a gradual increase in gas production over the coming years as domestic demand from power generation gathers pace. We forecast an OPEC basket oil price for 2012 of US$111.47/bbl, which we see falling to US$107.00/bbl in 2013. Global GDP in 2012 is forecast at 2.6%, down from an estimated 3.0% in 2011, reflecting slowing growth in China, a faltering recovery in the US and a worsening eurozone debt crisis.
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Ghana Oil and Gas Report Q2 2012
