Africa Economy: New oil and gas port to open up Ghana to regional offshore market

A 600 million-dollar oil and gas free port enclave to be built in Ghana will open up the country's oil and gas industry to the African regional offshore market.

Frank Hagan-Brown, Commercial Executive of Atuabo Free Port, told Xinhua in an interview that this would cut down the cost of operations and servicing for the companies operating in Ghana's oil and gas fields.

Construction work at the harbor to be located on a 2,000-acre land at Atuabo, 326 km west of the capital, will start by the third quarter of 2015 and be completed in 25 months.

Construction is to be carried out by the China Harbors Engineering Company (CHEC) which won the rigorous competitive bid out of 19 companies that submitted their tenders in a three-year process.

Hagan-Brown said the Free Port would create space for services that were critical to offshore and deep water exploration, development and production.

He was speaking to Xinhua at the company's exhibition stand during the just ended Sixth Ghana Oil, Gas and Power Summit and Exhibitions organized by CWC Group, an international oil, gas, energy and infrastructure company, in conjunction with KROS Ghana, a local oil and gas management group.

Currently, the closest place vessel and rig repairs can take place for International Oil Companies (IOCs) operating offshore Ghana are located either in Cape Town, South Africa, or Las Palmas in the Canary Islands, at a cost of 500,000 U.S. dollars per day.

"Atuabo Free Port will attract companies that carry out rig and vessel repairs and this will save the OICs the cost of 10 million dollars per towage because it takes 20 days for a vessel to reach South Africa or Las Palmas from the Ghanaian waters," the Commercial Executive said.

He explained that the ability to attract investors into the enclave was high because their imports would have a 70 percent duty free and tax free access.

"With these services being offered here, the jobs are retained, the revenue is retained, and knowledge and technology transfer is assured for local employees of the service companies," he stated.

According to him, the establishment of the port would also be a very critical breakthrough for Ghana because there were more job opportunities in the associated service sector of the upstream oil industry.

"This is so because the upstream oil industry offers jobs that require a lot of expertise but in the related services sector, there are more opportunities for technicians and other related artisans and service providers," Hagan-Brown indicated.

He urged local businesses to acquire lands for onward leasing for fabricating yards because, apart from the provision of the port and the handling of cargo as well as security by the Atuabo Free Port, the rest of the activities would be done on open market basis.

"This will create a greater ability for best practice and the efficiency of scale, transfer of knowledge and technology and the opportunity to develop a local economy based on the support services such as catering and hospitality services, filling stations, business centers, malls, vehicle hiring services and schools, among a large pool of businesses," he added.

The official disclosed that a local human resource development company, Sominu, had been working with Atuabo Free Port to develop the business capacities of the locals.

The port construction itself will offer about 1,000 jobs but at the start of the operations the port would employ about 300 hands, while the bulk of the jobs to be generated would come from the individual businesses that operate within and around the port.

"The Luba Port in Equatorial Guinea is also operated by our mother company, Lonhro, and so we would have a lot to offer from that experience to make Atuabo Free Port a success," Hagan-Brown added. Endi