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General News Tue, 31 Jan 2012

How Wereko-Brobby Spent Ghana’s $31m On Toy

But Mills Gov’t Unable To Prosecute Him

Investigative Desk Report

Credible investigations conducted by The Informer, with supporting files from publications by Mr. Kofi Koomson’s Chronicle newspaper dated back in 2003, reveals that Dr. Charles Yves Wereko-Brobby, made Ghana lose whopping amount of over $31million following his decision to import a Strategic Reserve Plant (SRP); a venture which never saw the light of day.

The said amount, according to The Chronicle publication on December 18th, 2003, was as a result of the procurement, installation and later, dismantling of the SRP units, grounds works and installations undertaken by Glotec and other companies.

It would be recall that, the then Chief Executive Officer (CEO) of the Volta River Authority (VRA)Dr. Charles Yves Wereko-Brobby, imported a Strategic Reserve Plant (SRP) which virtually became an assault on the public purse, when the facility fails to provide the services for which it was brought into the Country.

The Chronicle in its publication titled “TARZAN’S ROLE & THE EVIDENCE”, indicated per documents in their possession that, Dr. Wereko-Brobby secured the 120 MW SRP which was then known as Emergency Power Plant (EPP) and ordered the Directors of Legal, Finance and EP & D to submit a contract within five days.

The report went on to state that a memo dated January 23, 2002, signed by the VRA boss and copied to the Director of Legal, Finance and EP&D, stated that, “We have secured a 120 MW Emergency Power Plant to enable us assure a reliable power supply for this year as well as assist the better management of the Volta Lake.

The Plant is expected to become operational from March 1, 2002, and should resolve the following critical problems”:

According to the memo, Dr. Wereko-Brobby ordered the three civil servants to prepare a draft contract within five days, that is Monday January 28, 2002.

In the continuing search by The Chronicle to further establish the direct involvement of Dr. Wereko-Brobby in the lease of SRP, it came across a letter dated January 10, 2002, addressed to Lushann International Energy Corporation, 2616, South Loop, Suite 502, Houston, Texas 77054.

The letter which had the heading “Lease of 85 MW Power Plant” was signed by Dr. Wereko-Brobby and was to the attention of one Quincy Sintim Aboagye.

In the said letter, Dr. Wereko-Brobby stated, “I am pleased to confirm that the Volta River Authority (VRA) is interested in leasing of an 85 MW Power Plant from your company under the following terms…”

Although the plant was brought into the country by Dr. Wereko-Brobby, it failed to serve its intended purpose, causing a huge financial lose to the state to the tune of over $31miion as result of its procurement, installation, grounds works undertaken by Glotec and other companies, and the most heinous of all, its dismantling.

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This is how Dr. Charles Wereko-Brobby willfully caused financial lose to the state, but yet the President Mills-led-NDC government three years in power is unable to prosecute him.

Dr. Brobby is walking as a free man in the wake of all this evidence, but the NPP today led by “Lawrence Addae” Osei Kyei Mensah-Bonsu is creating the impression as if Mr. Alfred Agbesi Woyome, who sued the Government of Ghana (GOG) and was paid compensation, has indulged in criminal act.

We, at The Informer, insist that Dr. Wereko-Brobbey be made to answer for his action which led to the Government of Ghana (GOG) losing whopping amount of over $31million for importing a toy Strategic Reserve Plant (SRP) which never served any purpose.

We reproduce The Chronicle’s publications on the SRP for your own judgment, whether or not the NPP as a political party has any good moral to refer to the NDC as corrupt when persons like Wereko-Brobby served in their government and have caused Ghana this huge sum of money.

Ghana: VRA Project Faces Closure as Company Defaults in Rentals

By John Bediako, 28 April 2003

Tema — A three-man delegation from General Electric (G.E.) Rentals has arrived in the country from the United States to collect rental arrears for the Strategic Reserve Plant (SRP), or, in default, the project faces a shutdown. Those in the country are Messrs. Joseph Dumakoski, site engineer, Larry Parker and one other.

The Chronicle's findings are that Joseph Dumakoski landed in the country on Sunday, last week and the following day, which was Easter Monday, he went straight to the site and went through every document. Report was that his presence and mission to collect some millions of dollars the Volta River Authority (VRA) had defaulted in payment sent shockwaves to the very livewire of the authority.

Ghana dismantles strategic reserve plant with help of GE

Dec 18, 2003 01:00 AM

by John Bediako

A combined team of engineers from the Volta River Authority (VRA) and General Electric (GE) of the United States of America have begun dismantling the Strategic Reserve Plant (SRP) which was brought into Ghana to bail us from the energy crisis but ended up becoming a liability rather than an asset.

For now, the VRA has halted all on-going projects and has committed personnel to the SRP site as an emergency demand to ensure that the first generating unit of the power system is ready for shipment. So far, three out of the five unites are to be decommissioned and taken out of the country.

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Investigations at the Energy Ministry revealed that no official reason was assigned but highly placed sources hinted that it was a VRA management decision. When visiting the SRP -- sandwiched between the Tema Oil Refinery (TOR), WAHOME Steelworks and the Electricity Company of Ghana (ECG) main Tema substation -- the team of engineers were spotted busily disconnecting terminals of 11.5 kV cables, fuel pipelines and all other connections to the wasteful project which among other things, led to the VRA workers' strike that compelled the CEO, Dr Charles Wereko-Brobby, to step aside and later resign.

A Tema-based Korean engineering company Glotec, which undertook piping to connect fuel to the main fuel tank to supply the plant was also at the site disconnecting pipelines to the main storage tanks. Information gathered has it that the three units among the five that came by sea are to be airlifted to an unknown base outside the country. The SRP project, this reporter gathered, has milked the state in that, almost every component of the set up is a “white elephant.”

The large size cables that were dismantled cannot readily be used anywhere by the VRA, huge investment into site preparation and the imported aviation fuel that was later found to be contaminated. The Customs, Excise and Preventive Service (CEPS) has been at the throat of the authority over tax on fuel that was imported to run theSRP. The most recent addition to the mess of the SRP is the acquisition of a transformer to regulate power that would be produced from the site.

The VRA, after identifying that General Electric assembled much older power generating equipment, ordered a new transformer which cost raised an eyebrow within the authority. As gathered, the VRA runs 161 kV and steps it down to 33 kV for the Electricity Company of Ghana (ECG), which in turn redistributes it to local consumers/individuals at 11 kV.

Unfortunately, at the time the VRA landed its transformer with a huge capacity of 161 kV stepped down to 11 kV at the Tema port, General Electric again interpreted the contracted agreement which states that, it is the responsibility of GE to supply a transformer to deliver power that would be generated by the SRP.

The transformer provided by GE is 31 years old with a disconnection switch also in similar age group. No wonder, it broke into two as engineers were lifting it with a crane recently. Luckily, no one was under it, else fatality would have been registered. Now, with the generating units of the SRP on their way out of the country as the project is abandoned, the question of where to utilize the huge expensive transformer that was ordered arises.

Investigations unveiled that even through the VRA is faced with overloading its transformer at various substations across the country, the transformer delivered by African Bag, representatives of a major European manufacturers, can not be utilized anywhere. Probably, in the future, it has to be under utilized at Aluworks, a company VRA delivers power to directly.

Even that, as the huge 161 kV is stepped down to 11 kV instead of passing it on to the ECG, the income from Aluworks to VRA also comes to focus. Presently, with VALCO shutting down, Aluworks is operating under severe stress for it is now importing raw materials.

From related information, it seems that the main reason for the dismantling of the SRP units is, VRA does not have money to run the plants on aviation fuel. First, an attempt was made to run the units on diesel but that failed.

So far, it is estimated that the country lost over $ 31 mm as a result of the procurement, installation and later, dismantling of the SRP units, ground works and installations undertaken by Glotec and other companies.

Source: Ghanaian Chronicle

Chronicle Details Tarzan's Role In SRP Fiasc

TARZAN’S ROLE & THE EVIDENCE

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Chronicle investigations have revealed that the main architect of the Strategic Reserve Plant (SRP) which has become an assault on the public purse was not the two top officials were sacrificed last month but rather, the immediate past Chief Executive, Dr. Charles Yves Wereko-Brobby.

Documents in the possession of The Chronicle show that Dr. Wereko-Brobby secured the 120 MW SRP which was then known as Emergency Power Plant (EPP) and ordered the Directors of Legal, Finance and EP& D to submit a contract within five days.

A memo dated January 23, 2002, signed by the VRA boss and copied to the Directors of Legal, Finance and EP& D stated that “We have secured a 120 MW Emergency Power Plant to enable us assure a reliable power supply for this year as well as assist with the better management of the Volta Lake. The Plant is expected to become operational from March 1, 2002 and should resolve the following critical problems”

Dr. Wereko-Brobby continued: “In order to expedite action to ensure that the plant will be commissioned in a timely manner, I would be grateful if you could prepare a contract which incorporates the contents of the letters exchanged between the proposed EPP Contractor and myself, Lushann International Energy Corporation of the USA”.

According to the memo, Dr. Wereko-Brobby ordered the three civil servants to prepare a draft contract within five days - that is - Monday January 28, 2002.

In the continuing search by The Chronicle to further establish the direct involvement of Dr. Wereko-Brobby in the lease of SRP came a letter dated January 10, 2002, addressed to Lushann International Energy Corporation, 2616, South Loop, Suite 502, Houston, Texas 77054. The letter which had the with the heading “Lease of 85 MW Power Plant” was signed by Dr. Wereko-Brobby and was to the attention of one Quincy Sintim Aboagye.

In the said letter, Dr. Wereko-Brobby stated, “I am pleased to confirm that the Volta River Authority (VRA) is interested in leasing an 85 MW Power Plant from your company under the following terms…”

Giving the terms of the lease, Dr. Wereko-Brobby stated that the plant was to be leased for a period of three years in the first instance; that the plant will be run on a base load basis for the lease period at a capacity charge of $0.015 per KW/h, subject to annual review on mutually acceptable basis.

He stated, “ The plant will be delivered within six weeks of the date of this letter but not later than ei8ght weeks from this date.

“The plant will be operated by your company for the entire duration of the lease and will be assumed to be operable at all times during the lease period.”

Dr. Wereko- Brobby also stated that the fuel for the plant shall be paid for by VRA and through a charge outside the agreed charges for the lease of the plant. He added that VRA shall secure all the necessary exemptions or be responsible for the payment of all customs, excise and related charges applicable to move the plant from port to operating site.

In the said letter, Dr. Wereko-Brobby noted that an agreement was to be reached on the technical requirements and operational issues needed to be resolved to ensure the optimal and cost effective operation of the plant and that the decision as to the suitable shall be reached prior to the shipment of the plant to Ghana.

The letter continued “The plant shall be commissioned not later than March 1, 2002, which date shall be effective date for the commencement of the lease period” adding that the VRA shall make satisfactory arrangements to ensure that payments are made in a timely manner and in a form that ensures convertibility of the funds.

“We are pleased to confirm that this letter can be treated as a firm commitment to your company in expectation that the foregoing arrangements will be addressed in a mutually satisfactory manner. We look forward to working with you to get this project off to an expeditious start and a very successful operation.”

Thirteen days after Dr. Wereko-Brobby entered into direct negotiations with Lushann International Energy Corporation, he wrote a memo dated January 23, 2002 to the Directors of Legal, Finance, EP & D and copied to DCE (E&O) and Adviser, CE’s Office. The memo, which was under titled “Lease of Emergency Power Plant”, was duly signed.

In it, Dr. Wereko-Brobby stated that the SRP was to resolve the problems of:

“Overcome the 450 MW restrictions on the Western corridor of the national transmission system by enabling the addition of the 120 MW in the Eastern portion of the network. Enable Togo and Benin to meet their power supply needs, overcoming the prospects of their losing the 70 MW export from CIE wheeled through the Western Corridor of our transmission.”

He added that the Emergency Power Plant was also to allow a third Unit of the Akosombo dam to be shut down thus reducing the draw down from the lake by 25%. It was also to reduce VRA’s dependence on imports from Cote d’Ivoire,” he said.

Yet to come to the fore is a confidential public document, which indicts the former VRA Chief for his role in the SRP project. According to the document, for a project of the magnitude of the SRP, it is normal practice that it is contracted to a company, which has a track record of carrying out works of similar nature.

The document said Lushann had no previous track record in the leasing of power plants adding the Lushann was preceded with no due-diligence to ensure it would be able to fulfill its obligations.

The confidential document also points out that no effort was made to seek alternative proposals from a minimum of two other sources, as is the normal practice in VRA for emergency procurement.

The document also states that the implementation plan which aimed at commissioning the plant within six to eight weeks from the date of issue of the letter of intent from was unrealistic and that Lushann never submitted any detailed schedule to support their ability to meet the schedule in spite of several requests from the VRA technical team that worked on the project.

Another interesting highlight of the document is that the project had no credible financing plan, therefore the March 1, 2002 date when the plant was expected to go commercial was alien to reality as VRA was still struggling to establish the $1 million letter of credit required to guarantee payments to Lushann.

Source: The Informer