Ghana has begun construction of a 300,000 bpd oil refinery as it looks to become a major oil producer in West Africa.
The project will be developed in three phases, with the first phase costing $12 billion.
It is funded by a consortium of construction and venture capital organizations: including Touchstone Capital Group Holdings, UIC Energy Ghana, China Wuhan Engineering Co. and China Construction Third Engineering Bureau Co.
Ghanaian President Nana Akufo-Addo said the project “promises to be a cornerstone of our nation’s development”, speaking at the project site in the southwestern town of Jomoro on August 19.
The West African nation currently imports 90% of the 800,000 bpd it consumes, according to in the African Union of Refiners and Distributors.
Ghana hopes the oil hub will produce enough refined products to supply all of West Africa and move the region off imports entirely by 2036. The country currently produces 132,000 bpd of crude oil, having achieved first production in 2010 .
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However, the sustainability of the plans has been called into question.
Talking to you Reuters, Bright Simons, vice president at Accra-based think tank IMANI Africa, he said the consortium behind the project “is not prepared for investment (and) the project does not have a bankable business plan.”
He added: “Our position is that this is a profiteering attempt to grab a land bank on the cheap.”
According to the local news source Graphics Onlinehas the government is offered $12.86 million in land compensation to communities affected by the upcoming refinery construction.
But Oliver Barker-Vormawor, a lawyer representing farming cooperatives, said his clients would not back down in the face of the government.
“The government’s hard-nosed approach diminishes valid concerns about the project’s social and environmental impacts,” he told US media.