Ghana could save close to US$500 million annually by shifting its thermal power generation from expensive liquid fuels to domestically processed natural gas, Ing. Dr Sulemana Yussif, Technical Advisor to the Minister of Energy and Green Transition on Petroleum, has disclosed.
Speaking at a Ghana Institution of Engineering (GhIE) Branch 4 forum in Accra, Dr Sulemana said expanding the country’s gas-processing capacity would be pivotal to achieving these savings. “If we switch from liquid fuels, let’s say light crude oil, to generate power and use gas, we are saving closer to half a billion on an annual basis. That is huge,” he stated.
The forum, held on September 3, 2026, focused on bottlenecks in Ghana’s energy-sector infrastructure, with particular attention on the proposed second gas processing plant (GPP2) and an onshore natural gas pipeline .
The Cost of Liquid Fuel Reliance
Ghana’s thermal generation fleet, comprising approximately 70% of dependable capacity, is largely dual-fueled, with natural gas as the primary fuel and liquid fuels—including Light Crude Oil (LCO), Heavy Fuel Oil (HFO), and Gasoil—as backup . However, periodic gas shortfalls have forced a sharp, expensive spike in liquid fuel usage, driving the power sector into deeper debt .
The financial burden is substantial. During the first half of 2026 alone, the government’s Gas-to-Power Strategy generated savings of GH¢3.08 billion (approximately US$268.5 million) by substituting gas for liquid fuels . This transition is expected to reduce electricity generation costs by roughly 75% compared to producing the same electricity using imported liquid fuels .
The economic impact of this shift was underscored in August 2026, when Energy Minister Dr John Abdulai Jinapor revealed that Ghana saved about $500 million last year through gas-for-liquid fuel import substitution .
GPP2: A Transformative Infrastructure Project
The GPP2 is designed to expand Ghana’s gas-processing capacity beyond the existing Atuabo facility, which currently handles approximately 120 million standard cubic feet of gas per day (mmscfd) against an installed capacity of 150 mmscfd . The new integrated gas processing facility is expected to add a modular capacity of about 100 mmscfd .
President John Dramani Mahama has pledged his support for the project, noting that increased investments from Jubilee partners (1.5 billion) will bring in more gas than the existing plant can handle . “We need to construct GPP2 to process the excess gas and supply it to electricity-generating companies that rely on gas,” he explained .
Finance Minister Dr Cassiel Ato Forson, during his 2026 Mid-Year Budget Review, outlined the project’s expected benefits, projecting the facility will generate nearly US$2 billion in economic benefits over five years through reduced fuel imports, foreign exchange savings, taxes, levies, and dividends . The project is also expected to create nearly 1,000 jobs .
Beyond power generation, the additional gas-processing capacity will allow Ghana to better manage associated gas produced from its offshore oil fields, where limited processing capacity could constrain further oil production .
Pipeline Infrastructure Critical to Realizing Benefits
General Manager for Engineering and Maintenance at Ghana Gas, Ing. Maxwell Kwame Kelly, argued that the economic benefits of GPP2 should be assessed against the cost of having insufficient gas-processing capacity. “If you consider the alternative to not having the gas processing plant, you realise that the benefit is colossal,” he said .
However, Ing. Dr Frank K. Pinto, Chairperson of the Ghana Institution of Engineering, Greater Accra, cautioned that the potential savings from increased gas utilisation would depend partly on the efficiency of the country’s gas transportation infrastructure. He said the proposed onshore pipeline would be important in ensuring that more of the economic value associated with gas transportation remains within Ghana.
A Broad Strategy for Energy Security
GPP2 is a key component of Ghana’s broader Gas-to-Power Transformation Policy, which also includes plans for a state-owned 1,200MW combined-cycle gas-fired power station at Kafodzidzi-Abrobeano in the Central Region . The plant, expected to enter commercial operation in 2028, will lower electricity generation costs, help reduce tariffs by 10–20%, and create over 2,000 jobs .
Officials say preparations for GPP2 are advanced, with financial close expected before the end of 2026, mechanical completion targeted for the first quarter of 2028, and operations scheduled for the second quarter .
