Ghanaian Energy Company Secures US$425m for Gas Expansion Project
Genser Energy Ghana Limited (“Genser”) has secured a US$425million loan to develop a gas pipeline and associated gas processing facilities in Ghana – a transaction that will not only support the company’s transition strategy but also contributes significantly to the West African country’s national climate change targets.
The funding comprises a US$325million syndicated senior loan facility and a US$100m mezzanine loan facility which will be used to refinance the company’s existing debt and support the next phase of its expansion.
This will result in the construction of a 105km natural gas pipeline to Ghana’s second largest city, Kumasi, a gas conditioning plant in Prestea, and a natural gas liquid (NGL) storage terminal at Takoradi Port.
Standard Bank South Africa and Stanbic Ghana acted as the debt arranger and coordinating bank for the syndicated loan, partnering with the Development Bank of South Africa, Absa, and Societe Generale in structuring the multi-tranched facility which provided Genser with the extended tenor required for a deal of this nature.
“As one of the largest banks in Africa with an on-the-ground presence in 20 countries, Standard Bank has a deep specialisation in energy and infrastructure and offers extensive financial solutions clients require across the energy value chain. Because of this extensive African footprint, we were able to partner with Genser to attract regional pan-African financial institutions. We brought our sector specialism to bear in understanding the current business and articulating its vision going forward,” said Olukayode (Cody) Aduloju, Head of Energy and Infrastructure, Investment Banking.
The availability of cheaper and readily accessible piped natural gas will assist Genser’s customers in the transition from imported trucked diesel and heavy fuel oil (HFO) to local natural gas alternatives – a low-carbon intensive fuel. This comparatively cheaper and cleaner energy source will support Ghana’s bid to relocate power plants from coastal regions to reduce line losses and improve the national grid’s energy efficiency. It further has the potential to position the country as a significant producer and exporter of NGLs.
“We are committed to partnering with businesses and other relevant stakeholders to ensure we find the right energy solutions to improve and drive Africa’s growth. This transaction enables Genser to take gas from the upstream – that would otherwise be flared – and direct it back into the Ghanaian economy. The processed gas and associated hydrocarbons will be used as fuel to provide power to homes, to displace kerosene and other more carbon emitting fuels as energy sources and provide natural gas and liquids for the industrial sector. This is imperative to Ghana’s energy transition and climate change goals,” said Sydney Nii Ayitey Tetteh, Head of Power and Infrastructure Ghana, Client Coverage.