Govt settles $150 million of WAPCo debt
Ghana has settled more than $150 million out of $230 million of its indebtedness to the West African Gas Pipeline Company (WAPCo).
The payment, representing more than 50 per cent of Ghana’s indebtedness to WAPCo, was made possible through the Energy Sector Levy Act (ESLA).
Speaking to journalists after the opening ceremony of the two-day West African Gas Pipeline Project Committee of Ministers meeting in Accra on Friday, the Managing Director of the WAPCo, Mr Walter Perez, said he was optimistic the debt would be fully paid before the end of 2019.
Ghana News Headlines
For latest news in Ghana, visit Graphic Online news headlines page Ghana news page
He said the settlement had contributed greatly to the efficient and reliable operation of the company.
In July 2016, WAPCo suspended gas supply to Ghana over unpaid bills by the government.
The suspension led to the intensification of blackouts, popularly known as dumsor.
The issue of Ghana’s debt to WAPCo had been a great source of concern to stakeholders, but yesterday’s announcement from Mr Perez had chartered a new path for the company and Ghana.
He expressed the hope that discussions on tariffs would be a win-win situation for all stakeholders.
Minister of Energy
Confirming the government’s payment of a substantial amount of the debt to WAPCo, the Minister of Energy, Mr John-Peter Amewu, told journalists that the government was committed to settling the rest of the debt within a relatively short time.
On the issue of tariffs, he said the West African Gas Pipeline Authority (WAGPA) had come up with a rate which would be discussed at the meeting.
He said participating countries were expected to abide by the tariffs that would be arrived at by the WAGPA.
“I, therefore, urge WAPCo and all other relevant stakeholders to cooperate with us and the regulator to determine a workable tariff that will be attractive and economical for all parties, as well as being sustainable over the long haul,” the Minister of Energy prayed.
He also urged WAPCo to consider not to rush in recovering its investment but must rather take into consideration the original objectives of the entire project, socio-economic factors of stakeholder countries and the market dynamics to ensure that value would be created for all stakeholders.
On the issue of a gas pipeline from Tema to Takoradi, Mr Amewu urged the WAPCo to see that arrangement as an investment opportunity instead of a competition.
He said the dynamics of the Ghanaian market showed promising prospects for WAPCo and the West African sub-region.
“The discovery of indigenous gas and its commercialisation, which did not exist at the time of the West Africa Gas Pipeline (WAGP) project was executed, must be seen by WAPCo as a strategic addition to its business model and not a threat,” Mr Amewu advised.
He said the interconnections between WAGP in gas volumes and revenue must be a win-win for all stakeholders.
He said Ghana’s resolve to build a petro-chemical hub in the West African sub-region created further opportunity for bi-directional flow of gas that made gas from Nigeria and Ghana complementary to each other and thereby enforcing a true regional integration built on shared use of infrastructure.
The Commissioner for Mines and Energy for ECOWAS, Mr Sediko Douka, expressed the hope that the meeting would find lasting solutions to existing challenges.
He listed some of the challenges as governance and legal framework, the deficit in the generation and transmission infrastructure, limited energy access, low performance of the power utilities, high tariffs and the development of the renewable energy.
The Managing Director of the WAGPA, Mr Barandoa Debo, said the WAGP project was a key asset for energy in the sub-region and expressed the hope that all challenges would be resolved during the meeting.