The Senior Vice President and Head of Ghana Business Unit-Kosmos Energy, Joe Mensah, has stated that with gas expected to be available in abundance from its expansion operations, his outfit is considering a public-private partnership (PPP) with the government to establish fertilizer manufacturing plants which will make use of the gas.
According to him, this initiative if successful will provide a long-lasting solution to the country’s fertilizer shortage conundrum that keeps resurfacing year-on-year to hamper farming activities and affect farmers economically.
Mr. Mensah emphasized that fertilizer shortage not only affects farmers and farming communities but is also a national security issue, as it leads to food shortages – influencing food inflation and translating into increase of food importations; thus affecting the exchange rate and defeating the zero-hunger target under SDG-goal two.
“We have plenty of gas, and we are going to be able to take advantage of our gas. We want to work with government to make sure the talks about fertilizer plants are a reality, so that when we have this gas and we have no place to keep it, we can feed it into the fertilizer plants and get the urea we need to pump-up agriculture. We will continue to use the innovative thinking of our employees and partner with leaders in the space to fight food insecurity in our communities,” he said.
Additionally, he emphasized that the mainstay of this country has always been agriculture, yet its contribution to Gross Domestic Product (GDP) is just about 20 percent; hence the need to take advantage of gas availability to grow the sector and ensure maximum yields from crop production.
Kosmos Energy acquired an additional 18 percent interest in the Jubilee field and 11 percent interest in the TEN fields of Ghana from Occidental Petroleum (OXY) earlier this year: increasing its interests in Jubilee to 42.1 percent and in TEN to 28.1 percent.
This expansion initiative, Kosmos indicates, will make available more gas that will foster sustainable fertilizer manufacturing plants for the country through right partnership agreements with government and other key stakeholders. It will be recalled that global fertilizer manufacturing giant CF Industries has indicated a shortage of nitrogen fertilizer due to soaring natural gas prices, which is threatening to reduce global crop yields next year.
In Europe, gas prices have jumped amid high demand as economies recover from the pandemic and with below-average gas storage levels at the start of the winter heating season. Meanwhile, natural gas is a key input in the production of nitrogen-based fertilizer, and higher costs have caused some producers to cut production.
The need for Ghana to be able to establish its own fertilizer manufacturing plants has been long highlighted, and with this great headway made by Kosmos Energy – especially with the most important component in the production mix, gas – government cannot afford to be sluggish in getting to the discussion table to finalize a PPP arrangement.
Fertilizer shortage was a major concern to farmers this past crop season, with government acknowledging it had acquired enough for the season – raising the question of the fertilizer’s whereabouts. The country’s ability to produce fertilizer will address smuggling issues and mismanagement in the system as well.
