Ghanaians woke up on Wednesday morning to the shocking news of the suspension of the concession agreement with Power Distribution Service (PDS) Ghana Limited with immediate effect.
A statement issued by the Minister for Information, Kojo Oppong Nkrumah, late Tuesday evening – July 30, 2019 – said fundamental and material breaches of PDS’ obligation in the provision of Payment Securities (Demand Guarantees) for the transaction had been discovered upon further due diligence.
“The Demand Guarantees were key prerequisites for the lease of assets on 1st March, 2019 to secure the assets that were transferred to the concessionaire,” the statement said, adding that, “The government is conducting a full enquiry into the matter, and the outcome will inform the next course of action.”
Additional information later emerged that, “Following the transfer of ECG’s assets and operations to PDS on March 1, 2019, ECG, acting as the beneficiary of the Demand Guarantees, subjected the Guarantees submitted by PDS to further due diligence tests. ECG received a letter from Al Koot, dated July 16, 2019, that claimed, among other things, that the officer who executed the Guarantees from Al Koot was not authorised and that the Guarantees are null and void.”
The letter also said that the officer had committed fraud. Stakeholders were briefed about the unfortunate and very negative developments and the need to visit Qatar to see the Reinsurer to verify the information received. The government has decided to crosscheck the information contained in the Disclaimer Letter by sending a delegation of stakeholders to Doha, Qatar, on Wednesday, July, 31 2019, to meet with officials from Al Koot.
In view of these developments, the Energy Commission also released a statement announcing its appointment of ECG on an interim basis because the agreement between Ghana and PDS had become “impaired”. But whichever way one looks at it, the controversy leaves a sour taste in the mouth of everybody, and, not surprisingly, some politicians are already making capital of it.
The Finder, however, takes consolation in the fact that both the Energy and Information Ministers have made it abundantly clear that the deal will be cancelled if it emerges that there was a deliberate attempt to defraud the country while the government would prosecute anyone found to have engaged in any fraudulent act.
Under the circumstances, nothing will be more prudent than to unravel the truth and bring all perpetrators to book. Time is of essence in the matter.