The Ghana National Gas Company (Ghana Gas), has taken the Minority Spokesperson on Energy, Kobina Tahir Hammond, alias “Drillship” to the cleaners, telling him to stop perpetuating an ongoing deliberate distortions, being fuelled by opponents of Ghana Gas.
It suggested that the man, who said, he started life as a Kenkey seller, was doing a Public Relations (PR) job for some faceless individuals, who are bent on taking over the management of Ghana Gas for their parochial interest.
The company, denied his allegation that a group of five people on the Board of the company, have inflated the cost of the gas infrastructure project at Atuabo and demanded proof from the New Patriotic Party (NPP) Member of Parliament (MP) for Adansi Asokwa in the Ashanti Region.
A statement signed by the Corporate Communications Manager, Alfred Ogbamey said, “Ghana Gas wishes to assure all that the allegations by the former Deputy Minister of Energy are without basis. The allegations are either based on Mr. Hammond’s misunderstanding or deliberate misinterpretation of the documents he claimed to be in his possession”.
It insisted “That nowhere in any document available in the public domain has Ghana Gas claimed that it has expended $1.3 billion on the project”.
It added that “The former Deputy Minister of Energy does not either understand or appreciate the documents he claims are in his possession”.
Therefore, “We request any stakeholder, including the Legislator to seek clarification on any information provided them with our offices before putting them out in public if the intent is not to malign or ruin the reputation of otherwise outstanding public servants”.
TK Mohammed, according to Alfred Ogbamey, “…may also be motivated by his self-confessed advocacy against Ghana Gas as exhibited in the controversy surrounding the reported takeover of Ghana Gas by GNPC”.
The facts according to Ghana Gas are that “The cost of the Western Corridor Gas Infrastructure Development Project, also known as the Ghana Gas project, has not been bloated as alleged by the Minority Spokesperson on Energy”.
Ghana Gas, is willing to engage the so-called experts that K. T. Hammond relies on in a public debate, if only he could name them and they could own up to their assessments”.
“The budgeted cost of the Ghana Gas project is $1,000,000,000.00. The agreed interest rate on this sum amounts to $300 million. So when the loan amount of $1 billion and the estimated interest of $300 million are capitalized, the asset cost will amount to $1.3 billion”.
It said that “in accordance with provisions of International Accounting Standards (IAS) 23 on Borrowing Cost, “all costs that are directly attributable to the acquisition, construction or production of the asset are to be capitalized as part of the cost of the asset”. Hence, the accrued interest of $300 million is to be added to the total cost of the asset”.
This does not mean the cost incurred on the project to-date is $1.3 billion, because at the end of the project, repayment of the principal loan and interest will be made on the actual amount expended. Currently, the amount disbursed on the project stands at $728 million.
The Minority spokesperson on Energy, KT Hammond, had alleged that the cost of the Ghana Gas project was bloated by some $600 million.
Speaking on CitiFMs Eyewitness News, the former Deputy Energy Minister, stressed that renowned experts in gas infrastructure could attest to the fact that the cost of the project was “absurd.”
He is also claimed that, a group of five people on the Board of GNG, inflated the cost of the gas infrastructure project at Atuabo.
“That project is absolutely bloated and as at yesterday, the document I saw, supplied by Ghana Gas suggest that they have expended as much as $1.3 billion on this project. I am talking about the group of five who are in charge. Five members of the board, there is the Chief Executive who is also a member of the board,” KT Hammond alleged.
According to Citi FM, the cost of the gas infrastructure project, has been questioned with some suggesting that there was evidence of massive cost overrun. The project which was awarded to Sinopec International Petroleum Service Corporation was expected to be completed in December 2012 but after about years of delay, Ghana Gas is now commissioning the project in phases.
And KT Hammond is saying “experts, engineers, technicians who know about gas infrastructure can swear that the project we have at Atuabo shouldn’t cost this country anything more than GHC 700 million.”
He was however quick to clarify that the blame should not be laid at the door step of the government because “sometimes, it’s not exactly the government; it is the people in charge. It is the people in charge who should then account to the government and to all of us.”
Regarding the takeover of Ghana Gas by the Ghana National Petroleum Corporation (GNPC), KT Hammond said the media war between the board chairman of Ghana Gas, and the Energy Minister seems to suggest that “there is a big interest and for that reason people don’t want to let go.”
He claimed that the gas infrastructure project was initially being undertaken by the GNPC but “some people lobbied; they lobbied so hard to take this project away…and they got the NDC phase two [Mills administration] to create this thing for them and so five people or so were put in charge.”
According to KT Hammond, through his dealings with the GNPC, he was privileged to know that the shares in Ghana Gas “were held 100% on behalf of government but one NDC senior member told me that I may be mistaken because he knew otherwise and that the shares were in the names of a few individuals.”
He, therefore recommended that during the takeover, “when the transaction advisors go in there, first, they should look at the shareholdership so that they clarify if it is 100% for government.”
KT Hammond stressed that he was not making mere allegations because “when I deal with these matters, I bring my reputation to bare on this so I’m not that flippant about matters as fundamental as this which touches on some individuals and some government officials and the government as a whole.”