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Tsikata Denies Charges

Fri, 7 Sep 2001 Source: GNA

THE former Chief Executive of the Ghana National Petroleum Corporation (GNPC), Mr Tsatsu Tsikata, has stated that the recent allegations of financial impropriety levelled against him are totally false.

He, however, welcomed the forensic audit into the operations of the corporation and expressed optimism that it will absolve him.


Mr Tsikata described the recent claim by the Energy Minister, Mr Albert Kan-Dapaah, that the GNPC drill ship, Discoverer 511, has been sold to pay for losses he incurred in derivatives transactions with Societe General, a Paris bank which obtained a judgement against GNPC in the total sum of $47 million, as baseless and without foundation.


He was speaking at a press conference in Accra yesterday to throw light on GNPC’s transaction with the Societe Generale, in respect of the Tano oil fields development and other related matters.


According to him, he never introduced himself to the bank as a “commercial, legally trained businessman, sophisticated in terms of understanding derivatives trading and the theory behind how derivatives work and how they can be used,” as alleged by the minister.


Rather, he said, the bank presented itself to him in his capacity as the Chief Executive of GNPC with the promise to assist in financing the corporation’s various activities, particularly the Tano fields development, which “I indicated to them as our priority”.


Mr Tsikata said from the outset he emphasised the need for the bank’s technical assistance to enable GNPC to achieve the objective of managing the risks involved in the venture, and specifically made requests for the training of GNPC personnel involved in the transactions.

He also asked Societe Generale to make relevant software tools for assessing and managing the positions GNPC held, and the bank obliged.


“So how then, can a person who made such requests that were acceded to by Societe Generale be accused of presenting himself to Societe Generale as sophisticated in his understanding of derivatives trading and the theory behind how derivatives work?” he queried.


The former GNPC Chief Executive said it is unfortunate that, the Energy Minister chose to quote copiously from Societe Generale’s self-serving statements without giving the public the benefit of knowing that these were disputed, and that there was testimony in the court proceedings which contradicted the statements of Societe Generale.


Mr Tsikata said the circumstances in which judgement was obtained by the bank against GNPC in the High Court in London were not disclosed by the minister.


He explained that the GNPC has been contesting the claims of Societe Generale since the bank instituted its action in 1999.


A statement of defence and counter claims were filed on behalf of GNPC, based on the fact that Societe Generale had provided negligent advice to the corporation, with regard to the strategy it recommended for the corporation to hedge its anticipated production of oil and gas from the Tano fields, he said.

Mr Tsikata said the High Court in London held a sitting last year and gave directions regarding the conduct of the cases, especially on the exchange of documents between the parties.


Subsequently, the GNPC and its lawyers took steps to comply with the directives of the court and among other things, filed statements from relevant personnel of the corporation, in respect of the transactions.


Mr Tsikata said these applications were still pending before the court, when the GNPC was instructed by the government to notify the solicitors that the case would no longer be handled by them, but by the Attorney-General’s Department in Ghana.


He said although the GNPC had some fees in arrears in respect of the solicitor’s fees, efforts were being made to settle them, and the solicitors continued to represent the corporation’s interest until they received instructions to stop and hand over to the Attorney-General.


Mr Tsikata said the solicitors, therefore, obtained permission from the court to withdraw from acting on behalf of the corporation.


For that matter, he said, their important applications were no longer pursued.

“Obviously taking advantage of this situation, Societe Generale applied to the court to make certain amendments to their case and then, thereafter, applied for judgement against GNPC. There was no representation by or on behalf of GNPC, and judgement was entered against the corporation,” Mr Tsikata said.


On the sale of the drill ship to cover his alleged indebtedness, Mr Tsikata said “if it was my personal debt, there is no reason for it to be recovered from GNPC or GNPC asset to be seized or sold in connection with the debt. And if the government despatched the Deputy Minister of Energy to London and Paris to try and reach a negotiated settlement with the bank, was the Deputy Minister negotiating on my behalf?”


On the Energy Minister’s statement that the drill ship was sold for $24 million, Mr Tsikata said reports in the oil industry circle have it that it sold for that amount in addition to transaction costs.


To obtain a full picture, these transaction costs must be disclosed to enable accurate comparisons to be made with regards to the purchase price, he added.


Furthermore, he said, the ship’s earnings of over $15 million from its operations in Mexico cannot be disregarded in the computations.


Mr Tsikata said at no time was any payment made to him personally in the transactions between GNPC and Societe Generale.

He said the minister’s claim that he (Tsikata) sold Ghana’s oil on the international market, at a time Ghanaians were queuing to buy petrol is false, and described it as a personal attack on his image, and dared the minister to cite one instance to prove his point.


“Those false claims cannot become true by stating them repeatedly,” he added.

Source: GNA