Over IFC’s $215 million loan to KOSMOS and Tullow

Civil Society Organisations (CSOs) in Ghana have accused the private business arm of the World Bank, the IFC, of having neglected their protestations and granting a loan facility of US$ 215 million to Kosmos and Tullow, two of the leading companies in Ghana’s Jubilee fields.

Steve Manteaw, Communications Director of Integrated Social Development Centre (ISODEC), one of the leading CSOs working towards proper development of Ghana’s oil industry in accordance with local and international regulations, said the coalition had appealed to all international financial institutions to withhold funding for further activities of these two companies since their Environmental Impact Assessments (EIA) were not complete.

He said the country itself has not yet completed its legal and regulatory framework, while major concerns of the indigenous people in the areas where the oil fields are located have not yet been met.

“This is what necessitated our call on the IFC and other financial institutions to hold on with their funding for all the companies working in Ghana’s oil fields for now”, he told a public forum organized in Accra last week to launch a report compiled by Oxfarm America and ISODEC Ghana on the Challenges oil find brings to Ghanaian leaders.

“It is therefore amazing that the IFC went ahead, in spite of our protestations, to grant the facility to Kosmos and Tullow”, Dr. Manteaw fumed. No sooner had Dr Manteaw finished with this comment than the European Union representative at the public forum stormed out of the premises for the forum. On his way out, the EU representative looked Dr. Manteaw in the face and blustered out, “Is that the way we dialogue?”

The ISODEC Communications Director, well known for his passion for issues concerning Ghana’s welfare in the face of International Geo-political and Economic concerns, wondered if it was with that kind of attitude “these people advise our governments”.

However, the IFC Country Manager in Ghana, Imoni Akpofure, believes the Corporation has done nothing wrong in granting the facility.

She said the Institution had not overlooked the concerns being raised on the grounds in granting the loans to Kosmos and Tullow.

Speaking to the Financial Intelligence on the issue, Ms. Akpofure confirmed that as soon as the documentation on the financing is complete, the corporation should be in the position to start disbursing funds to the two companies. She suggested that since the Ghanaian Environmental Protection Agency (EPA) has its own regulations, it behooves on them to ensure that EIAs are done and stakeholder concerns dealt with.

“It is not for the IFC to tell the Ghanaian EPA what processes the companies should comply with, so they are going to comply”, Ms Akpofure argued, adding that the IFC investment is only a portion of the total investment these companies are putting into their work in the oil fields.

“So the IFC funds being disbursed is actually insignificant if you look at the overall amount of money that is going there”, she continued.

The IFC Ghana Country Manager however gave the assurance that in all of IFC’s loan agreements, beneficiary companies sign clear covenants with the IFC to comply with local regulations, and issues related to local environmental and social protections.

“So, we are not in any way worried that if the money is disbursed then it means that all of a sudden the companies would not comply” She also added that the Corporation is holding a stakeholder forum this week because they have heard of more concerns being raised on the ground.

Dow Jones recently reported a move by Kosmos energy to get a new investor for its oil blocks in Ghana’s Jubilee fields. The energy company denied it with claims they had rather approached some international capital hubs looking for capital.

About a week later IMF announced the approval of a total investment package of US$ 215 for Kosmos and Tullow, both operating in Ghana’s Jubilee fields.