Largest private IPP in Ghana on course for 2017 completion

Ghanaian independent power producer (IPP) Cenpower Generation Company’s Kpone Independent Power Plant (KIPP), which is expected to become a critical baseload component in meeting the country’s growing electricity demand, is expected to be commissioned before the end of this year.

KIPP is in the Tema heavy industrial area, adjacent to the West African Gas Pipeline landing point and close to all main transmission interconnections. The plant is a combined-cycle gas turbine (CCGT) power plant, with a planned capacity of 340 MW and a multiple fuel operating capability.

The plant is designed to work with gas, crude oil and distillate; however, natural gas is envisaged to become the primary fuel, when Ghana’s domestic gas production and transmission network is completed.

The key project components include a 161 kV substation for power transmission, a natural gas pipeline of about 2 km that connects the power plant with the West African Gas Pipeline, a light crude oil (LCO) fuel supply, delivery and treatment facilities, including two on-site storage tanks with a capacity of about 18 000 m3, as well as offsite LCO storage tanks with a capacity of about 70 000 m3.

The CCGT plant will comprise two General Electric Frame 9E gas turbines, two double pass heat-recovery steam generators from Netherlands-based heat transfer technology solutions provider NEM, a Siemens steam turbine and electrical generators and auxiliaries.

African infrastructure equity investment company African Infrastructure Investment Managers (AIIM) investment director Vuyo Ntoi, one of the project’s core equity investors and member of Old Mutual Alternative Investments, says that the Cenpower project is a true realisation of Africa investing in Africa.

“In addition to the revolutionary impact that the project will have on Ghana’s electricity industry, set to add about 10% of energy to the generation stock . . . an outstanding feature of this particular project is that it is largely an African deal,” he stresses.

Ntoi highlights that, while the founding shareholders are Ghanaian, with 67% of the equity being held by African entities and 83% of senior debt having been issued by African lenders, this project is proof that AIIM can structure capital within the continent.

He adds that it will hopefully provide a template for future project finance for IPPs in Africa.

Cenpower Generation Company chairperson Samuel Brew-Butler adds that CCGTs represent an “attractive solution” to meet Ghana’s urgent need for additional generating capacity, owing to their high reliability and ability to operate a range of fossil fuel feedstocks. “A CCGT power plant combines the benefits of proven technology, lower emissions and being relatively predictable in terms of build and cost,” he stresses.

Speaking on the company’s decision to partner with AIIM on the project, Brew-Butler says AIIM’s equity funds are well known, with the company having “an excellent . . . record of delivery and a proven level of expertise when it comes to infrastructure projects on the continent”.