The West African Gas Pipeline (WAGP) is a 681 kilometre onshore and offshore pipeline designed to transport natural gas from gas fields in the western Niger Delta of Nigeria to consumers in Benin Republic, Togo and Ghana.

The project is estimated to cost about USD 590 million. In November 2004, the World Bank provided a guarantee of USD 125 million for Ghana, followed by the European Investment Bank’s provision, in December 2006, of a EUR 75 million loan to the Government of Ghana.

The EIB funding came as an investigation by the World Bank’s Inspection Panel was underway. This followed a complaint, submitted in April 2006, from project-impacted local communities around the Badagry area in Lagos, Nigeria. The complaint claimed that the project would cause irreparable damage to their land and destroy their livelihoods due to an incomplete Environmental Impact Assessment report and inadequate compensation for resettled communities.

Extensively promoted by its sponsors to reduce the cost of energy and improve the reliability of energy systems in Ghana, Togo and Benin, WAGP has dubious positive impacts. Its promises to contribute to Nigeria’s plans to end all gas flaring by 2008 and to foster regional integration are based on assumptions not backed up by any concrete plans. Moreover, the first damaging impacts of the currently under-construction WAGP were felt in Ghana in October 2007, with the local Environmental Protection Agency confirming that the WAGP operations have led to pollution of the sea at Aboadze in Ghana.

Myths surrounding the WAGP

Cheap sustainable fuel and electricity generation solution for Benin, Ghana and Togo.

As there has been no transparency around the terms offered to Ghana by the Chevron-Texaco-led consortium, and with a gas purchase agreement which obliges Ghana to buy WAGP’s gas at a set price for twenty years, there has been no estimation done on the affordability of the gas for regular consumers in Ghana, Benin and Togo, with no indicators on how the process will be adopted to the public and will actually improve wide access to energy.

Promoting regional integration

The WAGP will be linked to the existing and outdated Escravos-Lagos gas pipeline, built in the 1980s to pump gas from upstream areas near Lagos, in the middle of the conflict-ridden Niger Delta. This can only deepen the crisis in the Niger Delta.

An end to gas flaring in the Niger delta?

The sponsors of the WAGP project, including Chevron, Shell and the Nigerian National Petroleum Corporation, do not have a clear programme for reducing gas flaring in the Niger Delta.

EIB’s involvement

Despite concerns raised by environmental groups towards some of the EIB’s executive directors that funding should have been postponed until the EIB ensured that outstanding problems with the project were resolved, its Board of Directors gave the go-ahead to a project loan in December 2006. In meetings with Bank’s officials as well as correspondence, EIB staff claimed that the EIB would approve the loan only under certain conditions, subject to the World Bank’s Inspection Panel satisfaction, and would make sure that the project uses 100 percent associated gas. However, shortly after these statements, the EIB financed the project with NO conditions attached and with currently no information available on its website, except for a few lines about the amount of the lending provided and the beneficiary . The EIB has neither ensured that the project will increase access to energy for the citizens of Ghana, Benin and Togo, nor asked for a new Environmental Impact Assessment study that would include the old risky pipeline that WAGP will be connected to.