Business News of 2014-07-21

Ghana Gas’ compensation too little – Report

While the Ghana National Gas Company (GNGC) is yet to compensate all farmers affected by its project, payments to those compensated fell below rates set by the Land Valuation Board, a new report by the Centre for Public Interest Law (CEPIL) has said.
Livelihood challenges associated with the project constitute “serious violations” of Ghanaian laws and international human rights instruments, including the constitution -- which mandates government to pay “fair and prompt compensation” when it acquires land compulsorily, the report noted.
“Virtually everyone we spoke with who had received compensation expressed dissatisfaction with the amounts they received...For example, one woman in Asemnda-Suazo reported receiving just GH¢19 for the loss of four acres of pineapple,” said the report, which examines the impact of the Western Corridor Gas Infrastructural Development Project on local communities.
“In Agbezo, farmers were told that they could each receive between GH¢50,000-GH¢70,000 through compensation calculations that reflected the expected lifetime value of their crops; but after the destruction of their crops, GNGC suggested that compensation would actually be much lower and be calculated by acreage,” the report revealed.
GNGC has undertaken two rounds of compensation so far: in the first round of July 2012 some 166 farmers in Bonyere shared an amount of GH¢60,000, while the second round compensated 1,400 individuals across 57 communities with GH¢1.9million.
Aside from the massive gas processing plant in Atuabo, the project involves a pipeline whose right of way from Atuabo to Aboadze is approximately 111km long and 50m wide.
The total area to be cleared for phase-one of the pipeline is 4.725 square kilometres. The pipeline has a direct impact on over 60 communities in eight districts through which it passes, cutting through settlement areas, farms, and forests.
Aside from the lack of appropriate compensation, the report cites other problems associated with the project -- including the destruction of water-bodies and a general lack of access to justice and outside assistance for communities.
“Unless remedies are ensured, the net result of the gas project for the people of the region appears to be deeper poverty, greater difficulty meeting their basic needs, and a bleaker future for them and their children,” the report said.
The gas project is being constructed at a cost of US$800million borrowed from the China Development Bank (CDB). The project has been held back by slow disbursement from CDB, causing several deadlines for its completion to be missed.
Last week in Parliament, Minister of Finance Seth Terkper said government has decided to borrow only half of the US$3billion initially agreed with CDB due to new conditions set by the Chinese lender.
Source: B&FT
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