Ghana signs $13bn in Chinese loan deals
Accra, September 22, 2010
Ghana has signed nearly $13 billion worth of loan deals with Chinese investors to fund energy, agriculture and transport development in the West African state, the government said on Wednesday.
The deals were signed during a visit by President John Atta Mills to Beijing and come as Ghana prepares to join the ranks of commercial oil producers by the end of this year, with China among those looking to buy into its offshore Jubilee field.
The new loans include $3 billion from the Chinese Development Bank to finance oil and gas infrastructure and agricultural development, Deputy Finance Minister Fiifi Kwetey told Reuters over the phone from Beijing.
'It's a comprehensive facility that would be used to develop the oil and gas sector and also to scale up infrastructure for agro-industries throughout the country,' Kwetey said.
A second loan deal for $9.87 billion was signed with Chinese Exim Bank for road, railway and dam work, he said.
Ghana is on track to produce its first barrel of oil by the end of this year with production forecast to quickly ramp up to 120,000 barrels per day and eventually reach 250,000 bpd - making it sub-Saharan Africa's No. 6 producer.
Kwetey said the broad framework for the use of the loans had been agreed but he declined to give details and said the specifics would be worked out later. He added the loans will require final approval from Ghana's parliament.
Ghanaian Deputy Energy Minister Emmanuel Buah told Reuters last week Ghana was making progress in talks with unnamed Chinese investors interested in buying a stake in the Jubilee field. It was not clear whether there was a link between that and the loans agreed in Beijing.
Jubilee, operated by Britain's Tullow Oil, holds around 1.6 billion barrels of light crude and is one of West Africa's biggest recent discoveries, but developments have often been overshadowed by talk of disputes between state oil firm GNPC and foreign energy firms.
Last month US-based Kosmos Energy cancelled an estimated $4 billion deal to sell its stakes in Jubilee to ExxonMobil after months of resistance from GNPC, which made no secret of its own interest in the assets.
Oil production is expected to help boost Ghana's growth into the double-digits next year, making it Africa's top performing economy.
The country, the world's second largest cocoa grower, is also aiming to boost its production of cocoa to 1 million tonnes per year by 2012 from 710,000 tonnes during the 2008-09 season.-Reuters