Coercing GNPC to seek $431m loan without parliamentary approval illegal - Minority
The Minority in Parliament has accused the Presidency of “coercing and compelling” the Ghana National Petroleum Corporation (GNPC) to seek a $431 million loan agreement from Lukoil International Trading and Supply Company (LITASCO) SA, a Swiss company operating refineries and retail network in Europe.
It said the act by the Presidency was unconstitutional, unlawful and blatant disregard to the directive and resolution of Parliament.
Per a memo intercepted by the Minority, the Presidency called a meeting on September 14, 2023 at 11 a.m. and directed the GNPC to seek for board approval to raise the amount without parliamentary approval, a directive some board members of the corporation kicked against.
Those who were present at the meeting were the Chief of Staff, the Executive Secretary to the President, the Minister of Finance, Deputy Minister of Energy, the chief executives of Karpower and LITASCO and other executives of both companies, it said.
Don’t commit illegality
Speaking to the press in Parliament on Wednesday (Sept 20), the Ranking Member on the Mines and Energy Committee, John Jinapor, called on the Chief Executive of the GNPC and the board to decline the directive from the Presidency.
“If you proceed with this directive, you will be committing an illegality. You do not have that mandate and that power to enter into such an agreement without parliamentary approval.
“The Minority wish to serve notice that we shall use every necessary tool available to ensure that we what is right and legal,” Mr Jinapor warned.
The MP for Yapei Kusawgu just before Parliament rose in August this year, the Committee on Mines and Energy, under the chairmanship of Samuel Atta Akyea, submitted a report of the committee on the 2023 work programme of the GNPC.
He said one of the key issues that came up for consideration was a request by the GNPC to raise an amount of $620 million in a form of loan facility from LITASCO SA.
He said Parliament took a decision that it could not approve that amount in the GNPC’s work programme.
He said Parliament was explicit that the corporation should lay the terms and conditions of the intended loan in accordance with article 181 of the Constitution for the House to consider same and make a determination.
“To utmost shock, we have come across a document that the Presidency is using coercive force and the power of the Presidency to compel the GNPC to proceed and execute this loan agreement without parliamentary approval,” he said.
He pointed out that some of the board members kicked against such illegality.
Collaterising TEN Field oil
The MP added that another document that was also intercepted at the board level of the GNPC had what he described as the deed of indebtedness, the JOHL Crude Oil Supply and Purchase Agreement, Jubilee Oil Holding Limited (JOHL) prepayment facility agreement, the guarantees facility agreement and the crude oil supply and purchase agreement.
“The key has to do with the fact that GNPC is raising this facility from LITASCO LUKOIL and in return they are giving our oil out to this company for the next five-and-a-half years.
“Indeed, all the oil in the TEN Oil Field have been incombered including royalties and our carried and participating interests will be escrowed into this company
More importantly, Mr Jinapor explained that every year a minimum of 3.8 million barrels of crude oil would be given to LITASCO for the loan being raised.
“No one even knows exactly what they want to use this money for apart from some repayment of debt.
“This is a government that received over $1.4 billion of oil receipts in 2022, the highest ever, and despite receiving this huge oil revenue from our oil sales, you want to take $431 million today and mortgage our future for the next five-and-a-half years and escrow the whole of TEN field oil,” he added.