press release

Chevron Press Release - West African Gas Pipeline Would Bring New Power Plants, Investment

WASHINGTON, D.C., Dec. 9, 1998 -- A new pipeline to feed Nigerian natural gas to power plants in three neighboring countries could bring $1.8 billion in investment and up to 20,000 new direct jobs to West Africa, a senior Chevron manager told a World Bank forum here last week.

Chris Miller, project manager for the West African Gas Pipeline Project, outlined a three-step plan to complete the pipeline project by 2001. The project would ensure decades of reliable natural gas supply to fuel new power plant developments in Ghana, Togo and Benin, hard hit this year by shortages of hydroelectric power.

Miller said the project also would help end the Nigerian oil industrys flaring of gas, currently burned for lack of commercial markets. That would cut emissions of carbon dioxide and methane, two greenhouse gases, making the project an example of the clean development mechanism (CDM) concept. In the future, CDM may help emerging nations minimize greenhouse gases and build their economies at the same time, Miller said.

Chevron estimates up to $400 million in direct regional investment for the pipeline, another $600 million for the power plants, and $800 million in new, job-creating industries, such as minerals processing, according to Miller. A recent Dames and Moore study, commissioned by Chevron, sees 10,000 to 20,000 direct jobs from new industrial investment that depends on reliable fuel and power supplies, and up to three times that many secondary jobs.

The 620-mile offshore pipeline will ship up to 180 million cubic feet of gas per day for sale to power plants in Ghana, Benin and Togo. Some of the plants are already in operation. Others would be built by independent power producers, including a consortium led by KMR Power, which plans a 220-megawatt plant near Ghanas capital of Accra. Chevron in October announced a 20-year supply agreement to fuel the proposed KMR plant.

Beyond the energy and economic-development benefits, Miller said the pipeline project is an opportunity for West Africa to show it can attract foreign investment: The region must prove that it can be competitive against other parts of the world in attracting private capital. There is no better or more immediate opportunity to achieve this than the pipeline project.

Mr. Millers speech is entitled,Three Short Steps to Long-Term Energy.

Notes to editors:

According to the Kyoto Protocol, developed countries may be able to meet part of their greenhouse gas reduction goals through participation in cooperative projects and by trading emissions credits -- a process known as flexible mechanisms. One such arrangement, dubbed the Clean Development Mechanism,(CDM), provides a means whereby developed nations and businesses can obtain credits for engaging in projects which would reduce greenhouse gas emissions below the level of their original estimates, while supporting sustainable development and investment projects. Rules have yet to be negotiated, but will determine the extent to which such projects can contribute to global emissions reductions and the degree to which industry will employ the mechanism.

Updated: December 1998