For Societe Generale In US$24 Million State Drillship Sale
The longest-serving Chief Executive Officer (CEO) of the Ghana National Petroleum Corporation (GNPC), Tsatsu Tsikata, has questioned the sale of the controversial oil drill ship, Discoverer 511, by the John Agyekum Kufuor administration in 2001.
Mr. Tsikata said that the oil drillship was raking so much revenue for the country, it should not have been sold out, besides, GNPC needed the drillship in its crude oil exploration.
According to him, ex-President Kufuor, his then Minister of Finance, Osafo Marfo, Albert Kan-Dapaah and his Deputy, Kwabena Tahir Hammond, behaved as though they were debt collectors for the French bank, Societe Generale, hence did not see any merit in the rebuttals that GNPC was putting up, against the claims of the bank.
He said, at various instances Ministers in the Kufuor administration spoke as though they were acting for and on behalf of the Societe Generale, instead of the Government of Ghana (GoG), adding “there was neither a judgement nor a judgment debt against GNPC, much less against the GoG” at time of his exit as GNPC boss.
“The President of the Republic himself was becoming the debt collector for Societe Generale.…When did the President of the Republic of Ghana, become a debt collector for anybody, you know, much less a French Bank or the Attorney General or the Minister of Energy or his Deputy for that matter”, he wondered.
Meanwhile, Dr. Ghesika Agambilla, Deputy Minister of Finance in the Kufuor administration, has virtually denied his membership of a three-member Committee which was chaired by KT Hammond to negotiate with Nick Mends, Vice-President of Societe Generale in-charge of Commodities in New York.
Dr. Agambila, who spoke on an Accra-based Radio Gold yesterday, insisted he could not remember any discussion or a Committee on the drillship, which he was part of and directed the radio station to speak with Ms. Gloria Akuffo, a former Deputy Minister of Justice in the Kufuor administration.
Mr. Tsikata, could also not fathom why Nana Akufo-Addo, the then Attorney-General and Minister of Justice in the Kufuor administration, stopped a competent law firm in the UK, Bindman and Partners, from defending GNPC only for Societe Generale to procure a judgment in default thus creating the basis for the sale of the drillship under a very bizarre circumstance to offset a US$19.5 million to the bank.
He revealed how Societe Generale, went behind GNPC to see then Vice-President, John Atta-Mills and then Finance Minister, Kwame Peprah to get some money from the Rawlings regime over the hedging arrangements, but were told to go and see GNPC, since it was a corporate entity that could handled its own affairs.
He was shocked that the same bank took advantage of a change in government in 2001, and started negotiations leading to the payment of US$19.5 million to it by the Kufuor government, despite the overwhelming evidence that Societe Generale, wanted an amount of US$12 million.
He also revealed how he met Mr. Kan-Dapaah the then Minister of Energy to brief him on the status of GNPC and also wrote a legal brief to Nana Akufo-Addo on the Societe Generale case against GNPC, talking about how the bank acted negligently in the transaction as well as its unwillingness to disclose documents and audio tapes to the GNPC while the case was in the UK Commercial Court.
Whilst vehemently denying allegations that the drillship was used as collateral to secure the funding transaction with Societe General, Mr. Tsikata also questioned the valuation of the ship, which was subsequently sold for US$24 million to defray a negotiated US$19.5 million debt owed Societe Generale.
Mr. Tsikata made these revelations yesterday, when he appeared before the Justice Yaw Apau Commission, constituted to investigate the phenomenon of judgment debts in the country.
His testimony contradicted those given by Mr. Kan-Dapaah and KT Hammond respectively, both of whom told the Commission last Monday that GNPC had incurred a debt of US$40 million in their transaction with Societe Generale.
Both men claimed GNPC had been run down and was in such a mess, prior to the coming into office of the Kufuor administration.
Mr. Kan-Dapaah in particular, claimed that the drillship had been used as collateral in the oil exploration funding activities with Societe Generale.
The French Bank, he noted sought a court order in Oman, where the ship had docked, to take over the ship and even made attempts to sell the ship.
He said the government subsequently agreed to sell the ship after due valuation and diligence had been concluded. But Mr. Tsatu Tsikata denied the claims.
He told the Commission there was no need at all to sell the ship, adding, the ship was in good condition before he left office besides Mr. K.T Hammond had no capacity or expertise to singlehandedly sell a valuable state asset like the drillship.
He argued, given the commercial activity the ship was engaged in and the revenue it was making to the country, it was completely ill-advised for the Kufuor administration to sell the ship.
He said with Societe General dangling a default judgment around the neck of the country, it was absolutely impossible to have gotten a good price and value for the ship.
He described Mr. K.T Hammond’s claim that Bindman and Partners law firm had no speciality in oil matters as very ignorant, since the prominent law firm has expertise in both human rights and commercial law.
Tsatsu Tsikata, threw a challenge to doubting Thomases and even to critics who disbelieve his testimony to the Judgement Debt Commission to come forward and cross examine him.
Mr. Tsikata insisted his testimony before the Commission is factual and a true representation of what transpired during his tenure as GNPC boss.
Mr. Tsikata also told the judgement debt commission, that GNPC could not have been described as being in a state of mess.
He said, the Corporation at the time had liabilities, but had assets too, which none of the critics seemed to be talking about, he mentioned Ecobank Ghana Limited, Total Oil, Oando Oil Ghana Limited and Westel Ghana Limited, a telecommunications company which was sold by the Kufuor administration for US$120 million.
He also dismissed claims that the controversial oil drillship had been collateralized in the oil exploration transaction with Societe Generale.
Tsatsu Tsikata said a “mortgage document” was drafted between GNPC and Societe General to cover the oil drillship but that document had no indication of any amount “due and payable.”
He challenged anybody with contrary information or facts to be allowed to step up and cross examine him adding, “Societe Generale had actually initiated some steps previously to have the drillship of GNP brought into the United States, somewhere in Texas, but they were not successful in that, and they took the matter to an Appeal Court and they were also not successful.”
But the Judgement Debt Commissioner, Yaw Apau declined the offer of a cross examination, stating, “You are not on trial and so nobody would be able to cross examine you.”
Mr. Tsikata explained that the GNPC was sued as a “statutory body by Societe Generale in a case that they brought in a High Court in London and GNPC contested the liability that was claimed in that suit.”
The GNPC, therefore, contested the liability that was claimed in that suit, and contracted a legal firm, Bindman and Partners, which entered an appearance on behalf of the corporation including counter claim.
This, Mr. Tsikata said was done with the approval and knowledge of the board of GNPC.
According to him, when the claims were brought against the company, his outfit “began discussions with them by way of a settlement process and those discussions from their side recognized that they were very conscious of the circumstances which had created problems of the GNPC in terms of the derivative transactions that we were undertaking.”
“…So on both sides, there was a clear understanding that it will be of mutual benefit to try to resolve through negotiations and that is why as I indicated, they themselves made certain proposals for negotiations,” he added.
The former GNPC boss accused Societe Generale of acting “negligently in breach of care to the corporation” because the latter had “acted as advisors to GNPC…in connection with the matters that Societe Generale had brought the claim on.”
On this basis however, the GNPC did not accept liability hence mounted a solid defence against Societe Generale.
He recounted that his outfit “recognized that if we were seeking to challenge the liability arising on the basis on negligent advise, we should at least be willing to reimburse payments made to us at GNPC and we authorized our lawyers therefore, to continue the negotiations and at the time, the discussions came to about around $12 million at a certain point in time.”
According to him, he wrote a detailed brief to the then Attorney General, Nana Akufo-Addo on the ongoing court case in
A London on the matter in which he highlighted. But asked if he could submit the brief which was sent to the AG to the Commission, Mr. Tsikata explained that the computer on which he worked on at that time “was stolen from my house in some very interesting circumstances.”
The former GNPC boss also accused Mr. Kan-Dapaah of launching a personal attack on him “and made a number of allegations essentially seeking to make it seem like I had taken steps personally and even claiming that I was paid monies from Societe Generale.”