Mr. Godfred Yeboah Dame, the Attorney General (AG), says the Criminal Investigations Department (CID) of the Ghana Police Service, will investigate the Power Purchasing Agreement signed between government and Ghana Power Generation Company (GPGC), exposing the nation to a financial loss.
He said the agreement was unnecessary and ill-informed because the country did not need excess power at the time and that an inquiry would be instituted into the matter to protect the public purse.
The AG said the agreement contained clauses, which rendered the government liable for payment of huge sums of money, saying, “irrespective of whether it was terminated before it became effective or not, government was exposed to financial loss.”
The Commercial Court in London, reportedly refused to allow Ghana to bring a belated challenge to an UNCITRAL award worth over US$134 million in favour of a power contractor, ruling that national elections and COVID-19 pandemic, did not make the state’s delay reasonable.
The case started under Gloria Afua Akuffo, then Minister of Justice and Attorney General, with Godfred Yeboah Dame as one of her Deputies.
State attorneys, including Helen Akpene Awo Ziwu, Anna Pearl Akiwumi Siriboe and Grace Oppong Dolphy in Accra, were also mentioned in the case as having failed to beat a 28-day deadline.
The delay resulted in the State having to pay $170 million in damages to the claimants; Ghana Power Generation Company (GPGC) located at 1 Airport Square Building, 7th Floor, Accra.
In a ruling on Wednesday, June 8, 2021, Mr Justice Butcher, refused to grant the government a time extension to set aside the award, saying, the State’s grounds for challenging it were “intrinsically weak”.
The underlying dispute is about government’s alleged wrongful rejection in 2018 of a contract for a “fast-track power generation solution” – involving the relocation of two aero derivative gas turbine power plants to the government’s territory.
A London-seated UNCITRAL tribunal composed of former ICC Court President John Beechey as chair, J William Rowley QC and Ghanaian academic, Albert Fiadjoe, issued its final award in January, ordering the government to pay a contractually defined “early termination payment” of more than $134.3 million plus interest and costs.
The tribunal also dismissed the government’s counterclaim, according to reports.
It is said the award is worth around $170 million and under English law, the government had 28 days to bring a challenge to the award.
Three days before the expiry of that deadline, the government’s then solicitors, Omnia Strategy applied to the court for a 56-day extension, due national elections and COVID-19, reports indicate.
The court, reportedly, agreed to extend the deadline for any challenge to March 8, but the government only brought its set-aside application on April 1, now represented by Volterra Fietta.
Reports say, in the latest ruling, Butcher J, said the government’s delay was “significant and substantial”, as its request for a second extension had come 38 days after the statutory deadline and 27 days after the first extension expired.
That an entity may have “bureaucratic decision-making processes, ” does not justify delay, the court said, adding that, for arguments about COVID-19 , the evidence as to the way in which the pandemic had affected the government was “wholly inadequate”.
The judge reportedly said there was no unfairness in denying an extension, as the government had already been granted one extension and was solely responsible for having missed the deadlines.
Mr Dame, also the Minister of Justice, blamed the signatories to the agreement for the $170 million judgement debt and said “the fact as borne out by the PPA committee’s report was that the agreement, together with other agreements, had resulted in such excessive power supply to the state.
The state was going to lose $586m per annum and a cumulative cost of about $7.6billion dollars between 2013 and 2018.”
“So I think that when it comes to financial loss, it is so clear in my mind that the responsibility lies clearly with those who entered into the agreement.
The basic point is that the entry into this transaction was unnecessary. The entry into this transaction was what resulted in financial loss to the state.”
Mr Benjamin Boakye, Executive Director, Africa Centre for Energy Policy, said it was “extremely reckless for us to pay this amount because people engage in power play,” and said it was important that government officials paid attention to agreements approved by Parliament to avoid judgement debts.