The Mines and Energy Committee of Parliament, will today continue its hearing into the US$1.5 billion gas deal between the Ghana National Petroleum Corporation (GNPC) and Genser Energy Ghana Limited, a Ghanaian-American registered company.
GNPC, buys gas at US$6.08/MMBtu from ENI and sells to its favourite, Genser, at US$2.79/MMBtu, which would further be discounted to US$1.79/MMBtu in an amended agreement for 16 years, creating a direct subsidy of US$1.5 billion.
The Genser is billed to make an appearance before the committee. Other institutions, including the Ministry of Energy led by Mathew Opoku-Prempeh, are also billed to make an appearance.
Some of the institutions that have already appeared before the Committee are Ghana Gas and the Volta River Authority (VRA).
While, Ghana Gas through the Chief Executive Officer (CEO) of the Ghana National Gas Company (GNGC), Dr Ben K. D. Asante answered questions on its transaction with Genser and how it moved away to deal with the GNPC, VRA is mentioned to have given details on its loss of revenue from the mining companies as result of the preferential treatment GNPC gave to Genser.
Dr Asante, had revealed to the Committee that he had rejected Genser’s demand to have the gas sold outside the market rate, insisting that when Genser was taking the gas from his outfit, it paid market rate.
It is not clear, if the Committee has plans to summon former Energy Minister John Peter Amewu, Deputy Minister of Energy Mohammed Amin Adams and former GNPC boss, Dr KK Sarpong, who were instrumental in the transaction to respond to some questions on it.
Interestingly, The Herald’s information is that the various members of the Committee, including opposition MPs from the National Democratic Congress (NDC) are constantly speaking with all those involved in the deal. Some of the NDC MPs, have even become spokespersons for some of the companies involved in the deal.
Genser, is owned and run by Nana Osae Nyampong and Baafour Asiamah-Adjei, the father and brother, respectively of the Akuapem North MP, Nana Ama Dokua Asiamah-Adjei of the New Patriotic Party (NPP) who is also a Deputy Minister of Trade and Industry in the Akufo-Addo government.
Meanwhile, Gold Fields Ghana, on September 22, 2022, reported a visit by the Parliamentary Select Committee on Mines and Energy to its Tarkwa mine for “a tour of the Genser power plant, which has been pivotal in meeting our Tarkwa mine’s electricity demand”.
Some people have questioned the essence of the trip by the MPs, as well as who sponsored it, explaining that documents on the deal are in Accra and all that the Committee has to do is to ensure that it was reviewed to get Genser join the by paying the market rate and not the special rate which has been cloaked as industrial rate.
On its official facebook page, Gold Fields Ghana had written “last week, the Parliamentary Select Committee on Mines and Energy visited our #Tarkwa mine to assess work done by our business partner, Genser Energy, to provide us with sustainable power for our mining operations”.
It said “our General Manager for #Tarkwa mine, Stephen Osei-Bempah, briefed the Committee about our operations and ESG priorities, highlighting our decarbonisation plan, which aims at reducing our total carbon emissions by 30% by 2030.
“He also shared success stories about our socio-economic development projects and programmes in our host communities, funded by the Gold Fields Ghana Foundation. The Committee members were also given a tour of the Genser power plant, which has been pivotal in meeting our Tarkwa mine’s electricity demand.
The Africa Center for Energy Policy (ACEP) and IMANI-Africa, have in the latest write-up on the deal said that “the operations of GNPC raise significant debt concerns. Cumulatively, the Corporation’s actions could cost Ghana between $5 billion and $6 billion in the short to medium term, adding “in 2022 alone, the Corporation programmes to make a loss of $195.25 million.
“While it shows loss-making ventures in its work programme, the Corporation seeks to hide profitable businesses offshore. A case in point is the 7 percent interest in Jubilee and TEN fields hidden in the Cayman Islands through Jubilee Oil Holdings Limited (JOHL) and seeking to collateralize the asset for loans.
“GNPC buys gas at $6.08/MMBtu and sells to its favourite, Genser, at $2.79/MMBtu, which would further be discounted to $1.79/MMBtu in an amended agreement for 16 years, creating a direct subsidy of $1.5 billion.
“According to GNPC, Accounting for Genser subsidy means the cost of gas for the market should be $7.9, not $5.9 as approved by PURC. This creates a gap of $3.6 billion to the sector if PURC does not increase the tariff to punish other consumers.
“GNPC enjoys significant government support and Parliamentary oversight failure to perpetuate these loss-making adventures. It is even worrying to note the complicity of the Ministry of Finance, which is currently in talks with the IMF for a bail-out far less than the orchestrated losses of between $5 billion and $6 billion from GNPC’s decisions. It tells why some have little faith in an IMF deal if we get one
More to come!
