UK's export credit agency pumps in $400m of funding to help GE Oil & Gas secure Ghana gas contract

 
Francesca Washtell
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This aerial view taken on November 2, 20
The Ghanaian project (not pictured) is worth $850m in total (Source: Getty)

The UK's export credit agency has agreed its first direct loan to a British exporter in Africa, pumping up an oil and gas firm's contract to the tune of $400m (£328m).

UK Export Finance (UKEF) will provide $400m to help GE Oil & Gas secure an $850m contract with the Offshore Cape Three Points Project in Ghana, including a loan under the UKEF's direct lending facility.

It is the first time a European government has supported a financing structure of this kind, the Department for International Trade has said.

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Private firm GE Oil & Gas provides is providing subsea production systems to the project, which will develop oil and gas fields around 60km offshore from the western side of Ghana's coast.

The first gas production at the site is expected in 2018 and the new fields will continuously feed Ghana's thermal power plants for more than 20 years, generating an additional 1,100MW of power for the country and help alleviate its reliance on energy imports.

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"The Offshore Cape Three Points Project will greatly improve Ghana’s energy security," said minister for trade and investment Greg Hands.

"Thanks to the UK Government’s support, via UK Export Finance, and our global leadership in oil and gas, UK companies are ideally placed to support Ghana’s future development and seize the huge export potential that brings."

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President and chief executive of GE Oil & Gas, Lorenzo Simonelli, said the contract represented GE's ability "to invest to build local partnership[s]" and will "utilise engineering and manufacturing expertise from the UK across the supply chain".

A Memorandum of Understanding signed between GE and UKEF in 2015 has helped support the loan.