"Hidden Debt" Was An Old Loan

The “additional” $200 million Tema Oil Refinery (TOR) debt (READ), which was revealed by the minister for Energy, Mr. Albert Kan-Dapaah, last week, was actually a loan contracted by the NDC administration from Korea, to set up the Residual Fuel Catalytic Cracker (RFCC) at the TOR.

In January 1999, the Korean company, SK Engineering & Construction Co., Ltd and Samsung Corp. entered a turnkey contract with TOR to build the RFCC plant. The project was completed in 2002 and commissioned by President Kufuor (READ).

According to the minister for Energy, the new debt was contracted to finance the recent re-tooling and re-equipping of the refinery that was launched by the President last year.

“I am not aware that any other such loan has been contracted for retooling the refinery. I would have known. I am sure the Government Spokesman or whoever said that does not know what he is talking about ” according to a source at TOR.

Kan-Dapaah said nothing was said about this new debt, "because, on paper they are likely or supposed to get it back through the production of products that will be exported."

As to why such a loan was contracted without parliamentary approval, an MP stated: “Loans contracted directly by state owned limited liability companies that do not require Government of Ghana guarantees are usually not subject to the Parliamentary process. They become liable for Parliamentary scrutiny if they require the backing of a sovereign government guarantee. That is the practice.”

The “additional” $200 million Tema Oil Refinery (TOR) debt (READ), which was revealed by the minister for Energy, Mr. Albert Kan-Dapaah, last week, was actually a loan contracted by the NDC administration from Korea, to set up the Residual Fuel Catalytic Cracker (RFCC) at the TOR.

In January 1999, the Korean company, SK Engineering & Construction Co., Ltd and Samsung Corp. entered a turnkey contract with TOR to build the RFCC plant. The project was completed in 2002 and commissioned by President Kufuor (READ).

According to the minister for Energy, the new debt was contracted to finance the recent re-tooling and re-equipping of the refinery that was launched by the President last year.

“I am not aware that any other such loan has been contracted for retooling the refinery. I would have known. I am sure the Government Spokesman or whoever said that does not know what he is talking about ” according to a source at TOR.

Kan-Dapaah said nothing was said about this new debt, "because, on paper they are likely or supposed to get it back through the production of products that will be exported."

As to why such a loan was contracted without parliamentary approval, an MP stated: “Loans contracted directly by state owned limited liability companies that do not require Government of Ghana guarantees are usually not subject to the Parliamentary process. They become liable for Parliamentary scrutiny if they require the backing of a sovereign government guarantee. That is the practice.”