President John Agyekum Kufuor on Friday laid a pipe for work to commence on the 40.2 million-dollar Buipe-Bolgatanga Petroleum Products Pipeline project at Buipe, in the Northern Region.
It would transport petroleum products, gasoline diesel and kerosene through an eight-inch diameter pipeline from Buipe to Bolgatanga in the Upper East Region, a distance of over 275 kilometres.
The Bulk Oil Supply and Transport (BOST) Company of the Ministry of Energy is executing the project, which is being financed by the Korean government with 38.2 million dollars and the rest by the government of Ghana and expected to be completed in November 2005.
President Kufuor said the project was part of the government's long-term objective of increasing the availability aimed at ensuring the equitable supply and distribution of petroleum products to all parts of the country to facilitate socio-economic development.
President Kufuor said the transportation of petroleum products other than by road to the northern sector of the country would be cost effective and efficient.
He said the project would promote mechanized agriculture and agro-processing industries and foster greater economic cooperation between Ghana and land-locked ECOWAS member countries such as Mali, Burkina Faso and Niger.
Mr Lee Sang-Pall, Korean Ambassador in Ghana, said the project marked "a special moment" in Ghana-Korea relationship and described it as the most important Korea's Overseas Development Agency (ODA) project in Ghana.
He said the Korean government and the business community was paying more attention to Ghana because of the nation's political stability and potential for growth as well as being a gateway to other West African countries.
Mr Joseph O. K. Addo-Yobo, Managing Director of BOST, said the project was the largest oil pipeline in the country and the single biggest infrastructure investment by BOST.
He said the project would improve the reliability and efficiency of fuel transportation and distribution in the country and provide skilled and unskilled jobs to reduce unemployment.
Mr Addo-Yobo said the project, which was currently employing 500 Ghanaians would also eliminate product adulteration or contamination while pilferage of petroleum would reduce considerably.
He assured tanker owners that the industry could not do without road transportation and said "The long-term benefit to them is the reduction in long and hazardous distances they take to travel, the risk to their lives and the high cost maintaining their vehicles".
The Managing Director of BOST said to make optimum use of the pipeline, the company would build six additional tanks at Buipe and Bolgatanga with total capacity of 60,000 cubic meters.
He said work on the tanks would begin in February next year. Mr Addo-Yobo said negotiations were underway between BOST and Tra International Oil Traders, which supply fuel to Mali and Burkina-Faso to use the pipeline and storage tanks as from 2005.
He said BOST was expected to earn not less than 5 million dollars next year from the transaction.
"Two years after completion of this pipeline, BOST expects to earn about 10 million dollars every year from it," he added.