Tullow confirms Jubilee gas flaring

Tullow Oil has received approval from government to flare gas from the Jubilee Field as it awaits completion of the Atuabo Gas Project, a company source has said.

The inability of the Ghana Gas Company to complete the gas processing facility has had serious consequences for oil production from the Jubilee Field, with operators having to re-inject the gas back into the wells.

Currently, the operators of Jubilee Field have pegged average production for the year at 100,000 barrels per day (bpd).

Asked whether the green light to flare means a resultant increase in production, the source said the partners are maintaining 100,000bpd and they are still in discussion with the EPA on volumes of gas to be flared.

The source added that when the production figures change, they will be communicated to the public accordingly.

Bloomberg quotes the Energy Minister Emmanuel Armah-Kofi Buah as saying the gas-flaring will be carried till October, when the onshore gas facility at Atuabo is expected to be ready.

“Government had to state a ‘no objection’ so that the EPA can regulate and allow for gas to be flared from now till October when the gas infrastructure will be ready. The flaring will allow for production to increase
because the re-injection has reduced volumes we could get from Jubilee,” he said.

Jubilee Partners, in their bid to salvage oil production levels, suggested a temporary gas bypass pipeline to the Volta River Authority’s Aboadze thermal plants -- but the latest development means that plan is effectively dead.

But energy policy analyst John Peter Amewu says government approval for gas to be flared is a “mistake”.

The decision, according to him, will have an adverse impact on the immediate environment of the Jubilee Field operation -- leading to acid rain.

He said government may have to reconsider its decision to allow gas to be flared till the gas processing plant is completed, especially as the facility has missed several completion deadlines.

Tullow owns 35.5 percent of Jubilee, which began production in 2010. US-based Anadarko Petroleum Corp. and Bermuda-based Kosmos Energy Ltd. each hold 24.1 percent. Ghana National Petroleum Corp. holds 13.6 percent and Sabre Oil & Gas Holdings Ltd. owns 2.7 percent.

The US$850million Atuabo Gas project, which is being constructed by China’s Sinopec with funds from the CDB loan, has suffered several missed deadlines and is now scheduled to receive its first gas in October.

The facility is expected to produce about 90 million standard cubic feet of raw gas per day on completion, and could peak at around 120million standard cubic feet per day.

By Richard Annerquaye Abbey | B&FT Online | Ghana