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* Terminal to begin LNG supply to power utility in 2016
* Final investment decision expected end of 2014
* Supplies expected from Qatar, other suppliers
By Kwasi Kpodo
ACCRA, Aug 3 (Reuters) - The Ghanaian subsidiary of QuantumPacific, the industrial investment group owned by Israelibillionaire Idan Ofer, has signed a deal with Golar LNG to build a $500-million liquefied natural gas import terminal.
The facility, to be situated offshore from the eastern portcity of Tema, will provide gas directly to the state-run VoltaRiver Authority (VRA) by mid-2016 to boost power generation, DonAckah, chief executive of Quantum Power Ghana Gas told Reuterslate on Saturday.
West Africa's Ghana is grappling with a power crisis causedby the frequent breakdown of ageing equipment and shortage offunds to purchase light crude oil for thermal generation. TheWorld Bank says the situation could worsen unless authoritiesoverhaul the sector to attract new investors.
Ackah said President John Mahama, who has instructed hiseconomic team to provide cheaper alternatives to light oil forpower generation, endorsed the Tema LNG project.
The VRA says it spends around $20 million every fortnight on crude oil purchases, draining the coffers of a country alreadystruggling to cope with a mounting budget deficit.
"A lot of work has already been done with payments committedto parts of the Tema LNG project. We are now aiming to completeall government approvals and secure gas supply and salesagreements for a final investment decision in the last quarterof this year," Ackah said.
Under the deal, Bermuda-headquartered Golar LNG will providean offshore floating storage and regasification unit. Talks arealso underway with French oil services firm Technip toconstruct subsea and onshore pipeline networks to deliver gas toTema, he said.
The floating unit, currently being constructed by SamsungHeavy Industries in South Korea, will have thecapacity to deliver at least 250 million cubic feet of LNG perday, or 1.75 million tonnes annually, Ackah said.
He said Quantum Power Ghana was in talks with global oilfirms, including BP, for the supply of natural gas.
In addition, the Ghanaian government said it planned astate-to-state supply arrangement with Qatar for LNG to bedelivered to the terminal.
"The government is only playing a facilitating role to getgas at a cheaper cost for consumers," Ackah added.
Ackah said the offshore production unit is expected toarrive in Ghana under a lease agreement by January 2016, addingthat all subseas construction should be completed by Decembernext year. (Reporting by Kwasi Kpodo; Editing by Emma Farge and KeironHenderson)
