This artifact informs the general public, governments and private sector about how a catalytic role of the World Bank can generate private finance to solve infrastructure problem is developing countries. It shows the case of a recent catalytic role played by the World Bank is going curtail electrical power outages in Ghana after project completion in 2018. Energy has a link to almost every economic sector with major impact on the present and future prosperity of a nation. The World Bank committed $700 million in guarantees in raising $7.9 billion from the private sector for the Sankofa Gas Project.

1. The
Sankofa
Gas
Project
in
Ghana
A
world
bank
financing
for
development
ac6vity
to
assist
the
energy
sector
in
Ghana
By
Joseph
Harrison
Mensah
Financing
for
Development
MOOC
Final
Assignment

2. Introduc6on
This piece illustrate how a very recent
catalytic role played by the World Bank is
going curtail electrical power outages in
Ghana after project completion in 2018

3. Background
• Energy has a link to almost every sector of the economy with
major impact on the present and future prosperity of a nation. It
contributes to employment, productivity, income and living
standard.
• Ghana sources her power production from hydropower facilities
(affected and rainfall and water inflows) and thermal plants
(affected by fuel supply).

4. Hydro
Thermal

5. • Power outages are phenomenal in Ghana. Historically there has
been major episodes which have had severe consequences on the
Ghanaian economy. The present present power crisis which
began 3 years ago, has proven hard to solve. On the average, one
could experience a 24hrs power outage and 12 hour power on
with disruptions.

6. Current
Supply
and
Demand
• Installed capacity: 2830MW
• Electricity demand at peak level is 1,980-2,300 MW
• The annual growth in demand is about 10 -12 %
• It is estimated that Ghana requires capacity additions of about
200MW to close the gap with increasing demand in the medium
to long term.
• The country supply electricity to neighboring Burkina Faso,
Benin and Togo

7. Power
Crisis
in
History
• 1982 – 1985: Caused by poor rainfall
• 1998 – 2000: Caused by drought in the sub-region due to the El
Nino climatic phenomenon and the increase in demand for power
in the country
• 2006 - 2007: Caused by poor rainfall and insufficient reliable
thermal power generators at the Aboadze thermal plant
• 2012 - Present: Caused by insufficient fuel to run the thermal
plants which is attributed to faults on the gas pipeline, and Lack
of financing for fuel procurement. Maintenance work on the
thermal plants There is also Poor rainfall, reducing hydro power
generation

8. The
impact
of
power
outage
in
Ghana
Power outages affect everyone and every sector of the economy
including households services, industry, agriculture
Power
outage
at
Sports
stadium
Effect
on
teaching
and
learning
Power
Outage
at
the
Parliament
of
the
Republic
of
Ghana
Impact
on
factories

9. The
effect
on
Gross
Domes6c
Product
The
current
power
outage
couple
with
macroeconomic
problems
(high
debt,
currency
deprecia6on)
and
infla6on
the
Economic
Growth
has
falling
dras6cally
Annual
Real
Growth
Rate
of
GDP
Source:
Budget
Statement
and
Economic
Policy,
Ghana,
2016
*
Revised
**
Provisional

10. The
Way
Forward
in
solving
power
crisis
• Increase
power
genera6ng
capacity
• U6lize
available
power
genera6ng
capacity
by
procuring
sufficient
fuel

11. World
Bank’s
Financing
for
Development
Assistance
to
Ghana
In July 30, 2015, the World Bank’s Board of Directors approved a
record investment of $700 million in guarantees for Ghana’s
Sankofa Gas Project - a new clean and affordable natural gas for
domestic power generation meant to tackle the country’s serious
energy shortage. Ghana took the proposal to the World Bank in
2014.

12. The
Sankofa
Gas
Project

13. The
world
Banks
cataly6c
role
• The $700 million are made up of two guarantees, an IDA*
Payment guarantee of $500 million that supports timely payments
for gas purchases by Ghana National Petroleum Corporation and
an IBR Enclave Loan guarantee of $200 million to enables the
project to secure financing from its private sponsors.
• The two guarantees together are to mobilize $7.9 billion in new
private investment for the project, which will be biggest foreign
direct investment in ever made in Ghana.
• Note that the $700 million used in leverage is raising $7.9 billion
from the private sector.

14. The
effect
of
the
banks
cataly6c
role
• Private investors, Eni of Italy and Vitol Group of the Netherlands will
carry out the exploration and commercialization of the natural gas in
partnership with Ghana’s National Petroleum Corporation, (GNPC).
• The Sankofa Gas Project will be completed by 2018
• When completed, it will supply the thermal plants with the need fuel for
power generation and replace polluting and costly oil-burning
electricity.
• Of significance it will fuel up to 1,000 MW of clean power
generation,
• Ghana will be able to reduce its oil imports by up to 12 million
barrels a year and cut carbon emissions by 1.6 million metric tons of
CO2 annually.

15. Conclusion
• Aside rainfall, inability to procure fuel for the thermal is one of
the two major causes of power outages in Ghana
• The world banks catalytic role will help curtail power outage in
Ghana significantly
• The Sankofa Gas Project will sustainably generate 1000 MW
• This will huge impact on employment, production, income,
standard of living, reduce importation of crude oil, reduce the
drawdown on foreign reserves etc.
• Note that the $700 million used in leverage is raising $7.9 billion
from the private sector. Thus with millions, the catalytic role of
the World Bank in the form of Guarantees is helping to mitigate
risk and mobilize private investment in billions to solve energy
infrastructure problems in Ghana

16. References
• 2016 Budget Statement and Economic Policy, Government of Ghana,
http://www.mofep.gov.gh/?q=content/2016-budget-statement-and-
economic-policy-government-ghana
• Energy Supply and Demand Outlook for Ghana, Ghana Energy
Commission, 2015
http://energycom.gov.gh/files/Energy%20Outlook%20for%20Ghana
%20-%202015.pdf
• The politics of power crises in ghana – Mohammed Amin Adam, 2015
http://thechronicle.com.gh/the-politics-of-power-crises-in-ghana-
chronology-of-government-responses-and-lessons-for-ending-the-
current-crisis/
• The world Bank, July 20, 2015
http://www.worldbank.org/en/news/press-release/2015/07/30/world-
bank-approves-largest-ever-guarantees-for-ghanas-energy-transformation
• http://www.theafricareport.com/West-Africa/electricity-ghanas-power-
crisis-deepens.html