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General News Wed, 31 Jul 2019

Ghana likely to lose $190m over PDS fiasco

The Minister of Energy, Peter Amewu fears cancellation of the concession agreement with Power Distribution Services Ghana (PDS) could come with some consequential loss.

In an exclusive interview with TV3 on Wednesday, the minister said Ghana may not be able to access part of the second Millennium Challenge Corporation Compact dubbed Ghana Power Compact.

“The danger is the second tranche of the facility [under the Millennium Challenge Compact]; that of course is what we all need to see whether it will be threatened as a result of the discovery of the finding,” he remarked.

Ghana is expected to receive the second tranche of $190 million from the Millennium Challenge Compact after meeting requirements to access the funds.

The country signed an agreement with the United States government to release some $498.2 million to support the transformation of Ghana’s electricity sector and stimulate private investment.

The first tranche of $308.2 million was released in 2016.

But Peter Amewu is hopeful the Millennium Development Authority would be “interested” that it was government’s effort that has detected the fraudulent process.

“But I think what the MCCA and MIDA needs to be aware of is the fact that government has taken a decision and of course it is government efforts that has led to this so i think they will be quite happy.”

He also explained the three possible outcome of the suspension of the concession agreement:



* if Al Koot letter saying payment security was fraudulent is validated, that will automatically lead to termination of the contract;

* government terminating the contract without validation could have consequences;

* if it is found out that payment guarantee was well executed, then the process will continue.

PDS is a Meralco-led Consortium made up of Meralco, three Ghanaian owned companies; TG Energy Solutions Ghana Ltd, Santa Power Ltd, and GTS Power Ltd with AEnergia SA of Angola.

PDS was mandated to undertake ECG’s Financial and Operational Turnaround Project and for that matter took over the management and operations of ECG.

But government on Tuesday, July 30, 2019 suspended the agreement which took effective from March 1, 2019 because it was fraught with illegalities.

Source: 3news.com
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