Ghana Seeks $1.5 Billion China Loan in Return for Gas Supplies

  • Parties suspended $3 billion finance deal signed in 2011
  • Ghana seeks funds to develop energy and gas infrustructure

Ghana is in talks with China Development Bank Corp. to revive a $1.5 billion loan that will be repaid through gas supplies as the West African nation seeks funding for the development of energy infrastructure, Finance Minister Seth Terkper said.

Ghana suspended a $3 billion finance deal signed in 2011 after the government utilized the first trance of the facility, or $1.5 billion, which it repaid through crude deliveries of 13,000 barrels a day.

“When crude oil prices fell, the source of financing for the entire facility became insufficient, so disbursement was stopped,” Terkper said by phone on Thursday. “This time we will use lean gas from the Jubilee oil field to pay for the remainder of the loan. We need that $1.5 billion now.”

Ghana is depending on a ramp-up in oil output at the Jubilee and TEN oilfields to revive economic growth, which the International Monetary Fund forecast will slow to 3.3 percent this year, the lowest rate in more than two decades.

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