Ghana’s petroleum industry finds itself trapped in an expensive paradox, flaring roughly 10.6 percent of its natural gas production while simultaneously importing costly diesel to power thermal plants, a situation costing the country an estimated $100 million annually in wasted resources and revealing critical infrastructure gaps that threaten both economic competitiveness and climate commitments.
The gas flaring problem, discussed extensively during the Public Interest and Accountability Committee’s recent mid year report launch, exposes the stark limitations of Ghana’s current processing infrastructure. Despite having what officials describe as a zero flaring policy, the country burned approximately 13.8 billion cubic feet of natural gas in the first half of 2025 alone, gas that could have powered homes, factories, and reduced dependence on expensive imported liquid fuels.
PIAC Chairman Constantine K.M. Kudzedzi acknowledged the contradiction when questioned about Ghana’s gas flaring practices. While the Environmental Protection Agency technically prohibits companies from flaring gas, the reality is that companies must flare excess production because Ghana’s sole operational processing facility, the Atuabo Gas Plant, cannot handle all the associated gas being produced from offshore fields.
“Gas flaring is an inevitable part of the whole industry,” Kudzedzi explained during the press briefing. “Once you are producing gas, you cannot use all the gas. And when you inject some into the well and then you use some biomass, you have to flare some of it.”
The fundamental issue isn’t whether companies flare gas but how much they’re forced to burn. Ghana produced about 130.4 billion standard cubic feet of raw gas during the first half of 2025, with the Sankofa Gye Nyame field accounting for 53 percent, Jubilee contributing 26 percent, and TEN providing 21 percent. Of that total production, operators flared 10.61 percent, down slightly from 11.53 percent during the same period in 2024.
That modest improvement masks a deeper infrastructure crisis. Between 2020 and 2024, Ghana flared approximately 102 billion cubic feet of gas from its fields, equivalent to an average daily supply of about 55 million standard cubic feet. This represents gas that could have powered thermal plants currently running on diesel, heavy fuel oil, and light crude oil at costs nearly three times higher than domestic gas.
PIAC’s head technical officer provided a blunt engineering perspective on Ghana’s zero flaring policy claims. When he first heard about the zero flaring policy, he admitted he “giggled as an engineer because you always have to flare gas.” Every country sets allowable limits for flaring, and the reasons for exceeding those limits depend on specific industry circumstances.
For Ghana, those circumstances revolve around inadequate processing capacity. When oil production increases, it brings more associated gas with it. Without sufficient infrastructure to process that additional gas, operators face a choice between curtailing oil production or flaring excess gas. Ghana has essentially been doing both, limiting oil output to manage gas volumes while still flaring what the Atuabo plant cannot handle.
The technical officer emphasized that declining oil production is partly driven by gas curtailment concerns. Producing more oil generates more gas, and without requisite processing infrastructure, operators must flare more, which creates environmental and regulatory problems that discourage production growth.
The solution, according to both PIAC and government officials, hinges on completing a second gas processing plant that’s been discussed for years but has yet to materialize. The new facility would convert previously flared gas into usable energy, addressing both the waste problem and Ghana’s growing electricity demand challenges.
PIAC has engaged extensively with the Ministry of Energy on the second processing plant, with technical officials participating in construction discussions. Richard Kojo Ellimah, a PIAC member, expressed cautious optimism after hearing the Energy Minister confirm cabinet approval for the project, calling for it to be treated as a national priority.
“If construction begins quickly, Ghana could begin benefiting from its excess gas within the next two to three years,” Ellimah said, according to reports on PIAC’s 2024 findings. The urgency reflects mounting financial and environmental pressures.
Ghana’s Energy Minister indicated the country needs approximately $1.2 billion in 2025 just to procure liquid fuels for thermal power generation. Using gas instead would save 50 to 60 percent of those costs, potentially freeing up $600 million annually, enough to fund construction of the gas processing plant itself.
But the infrastructure challenge extends beyond just adding processing capacity. PIAC’s technical officer urged journalists to champion establishment of industrial enclaves along gas infrastructure routes, whether pipelines, processing plants, or compressor stations. These enclaves would maximize utilization of the gas product passing through, creating economic value beyond just power generation.
The flaring situation is further complicated by Ghana’s contractual obligations with Eni, the Italian energy company operating the Sankofa field. During the briefing, officials explained why Ghana sometimes flares Jubilee gas while importing Eni gas, a situation that seems counterintuitive.
Ghana initially received foundation gas from Jubilee at zero cost for about a decade. After that period ended, any additional Jubilee gas requires payment. Meanwhile, Ghana has a take or pay contract with Eni, meaning the country must pay for contracted gas volumes whether it uses them or not. Any government would prioritize fulfilling the Eni contract to avoid paying for unused gas.
“If Eni gas is available and Jubilee gas is available, we will take Eni gas,” the technical officer explained. If Ghana needs 100 million cubic feet of gas daily, and Eni has 90 available while Jubilee has 80, Ghana takes about 80 from Eni and 20 from Jubilee. The extra Jubilee gas that can’t be taken gets flared because storage capacity is insufficient.
This contractual dynamic means Ghana sometimes burns its own gas resources while importing from Eni, a situation driven by financial obligations rather than operational logic. The take or pay arrangement essentially gives Eni priority in Ghana’s gas procurement, forcing Jubilee operators to flare excess volumes.
The environmental implications are significant. Gas flaring contributes to greenhouse gas emissions and air pollution, affecting both climate and human health. Ghana has committed to eliminating routine gas flaring by 2026, four years ahead of the global 2030 benchmark, responding to European Union methane regulations that are reshaping petroleum export markets.
The EU’s Regulation 2024/1787, which entered force in August 2024, targets methane emissions from global supply chains feeding European markets. With the EU consuming over 500 million tonnes of oil equivalent annually, exporters must now comply with stringent methane emission measurement, reporting, and verification standards or risk losing market access.
Victoria Emeafa Hardcastle, Acting CEO of Ghana’s Petroleum Commission, noted during Africa Oil Week discussions that these new rules are redefining petroleum business dynamics. Between 2025 and 2030, the EU will require exporters to demonstrate comprehensive methane management capabilities, making emissions control a matter of market access as well as climate responsibility.
Ghana’s accelerated 2026 target for eliminating routine flaring reflects recognition that compliance delays could prove costlier than accelerated investment. The country flared an estimated average of 32.68 million standard cubic feet per day between January and July 2024, resulting in approximately $210 million in lost commodity value and $287 million in total value chain losses.
ActionAid Ghana’s Country Director John Nkaw has called for stricter regulations and infrastructure investment to support commercialization of associated gas rather than allowing it to be wasted through flaring. The continued burning represents not just environmental damage but a massive opportunity cost for a country struggling with energy security and budget constraints.
The infrastructure limitations have serious implications for national energy security. As electricity demand grows, domestic gas supply is approaching capacity thresholds. The 2025 Energy Supply Plan reportedly highlights these constraints, with Ghana increasingly relying on expensive liquid fuels when domestic gas cannot meet thermal plant requirements.
PIAC officials stressed that while gas flaring falls somewhat outside their primary mandate, the committee has engaged with the Environmental Protection Agency and other agencies during validation exercises. The solution requires coordinated action across government agencies and sustained commitment to completing the second processing plant.
The timeline for that plant remains uncertain despite cabinet approval. Construction hasn’t begun, and previous timelines for similar infrastructure projects have proven optimistic. Each month of delay means more gas burned, more money wasted, and tighter compliance pressures as European regulations take full effect.
Ghana’s gas flaring dilemma ultimately reflects broader challenges in petroleum sector management. The country has significant resources but struggles with infrastructure development, contract management, and policy implementation. Solving the flaring problem requires not just building a processing plant but also developing industrial ecosystems that maximize gas utilization and creating regulatory frameworks that prioritize resource optimization over short term convenience.
For now, Ghana continues burning roughly $100 million worth of natural gas annually while spending $1.2 billion importing liquid fuels, a situation that makes neither economic nor environmental sense but persists due to infrastructure gaps and contractual obligations that constrain better alternatives.
Source: newsghana.com.gh
