Huge gov’t debt affects WAPCo

Harriet Wereko Brobbey, General Manager, Corporate Affairs of the West Africa Pipeline Company (WAPCo) Limited, says the huge debt owed the company by government is hampering efforts to invest in its operations and facilities.

Government’s debt to WAPCo is the region of $100 million but it has given assurance that it would honour its debt obligation soon.

“We have held discussions on the debt issue and government has indicated its commitment to pay its debts,” Ms Wereko-Brobbey told journalists at Tema.

She said her outfit has no reason to doubt government over the debt situation and added that the Volta River Authority (VRA) was funding the upgrade of the gas pipeline facility as an interested offtaker to handle 120 million cubic metres a day, 50 million more than its peak flow currently.

“The second phase will take the capacity to more than 200 million cubic metres.”

At present WAPCo, which feeds Sunon Asogli Power Plant and VRA thermal units, is pumping 10 million cubic metres.

N-Gas, the main supplier of lean gas to the Volta River Authority (VRA) through WAPCo, recently gave Ghana a two-week ultimatum to clear its outstanding debt of over $100 million or gas supply will be shut down.

The two-week deadline expired a fortnight ago.

The debt, which jeopardises WAPCo’s existence as a company, covers gas supplied to VRA and the cost of supply and transportation of the gas from Nigeria to Ghana by WAPCo.

Gas supply from Nigeria averages 20 million standard cubic feet of gas per day, which the Sunon Asogli Power Plant in Tema uses to generate over 100 megawatts of electricity.

It would be recalled that in October last year, N-Gas threatened to cut gas supply to VRA over some $181 million debt.

Government quickly paid $9.5 million of the amount for gas supplied from August 2014 to October 2015, leaving a balance of $171.5 million.

Ghana and N-Gas adopted a new arrangement to clear the outstanding debt of $171.5 million by the end of February 2016, as well as pay in full for fresh gas supplied.