Ghana Power Utility Postpones $500 Million Bond Offer to 2016

Ghana’s Volta River Authority, the West African nation’s largest utility, will look to loans and export-credit agencies to fund thermal-power plants after it delayed a $500 million bond sale to 2016.

“The bond sale requires a lot of paperwork and others which will take quite some time,” Finance Director Ebenezer Tagoe said by phone from Accra, the capital, today. “We need immediate funds to develop the two main thermal projects.”

Ghana, Africa’s second-biggest gold producer, is boosting electricity output as demand in an economy set to expand faster than the sub-Saharan African average for a sixth straight year in 2013 leads to chronic blackouts. Output is projected to be 7.9 percent of gross domestic product this year, according to the International Monetary Fund, faster than the regional rate of 5 percent.

The state-owned VRA will seek to raise $350 million next year in loans and credit, Tagoe said. The country is aiming to produce 516 megawatts of power at thermal-energy plants in Takoradi in the west and Kpone, near the port city of Tema, 30 kilometers (19 miles) from Accra, he said.

The VRA will add 2,500 megawatts of capacity to Ghana’s power grid as part of a $4.5 billion expansion, Tagoe said in October. The company has a capacity of 2,104 megawatts, or 79 percent of the nation’s installed power, he said.

The suspension of the debt sale was first reported today by Joy FM, a closely held broadcaster based in Accra.

To contact the reporter on this story: Ekow Dontoh in Accra at edontoh@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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