'Teshie Desalination Project was set up to milk the country' - Asabee

The Director-General of the State Interests and Governance Authority (SIGA), Stephen Asamoah Boateng popularly known as Asabee, has said the Teshie Desalination Plant contract signed between the Ghana Water Company Ltd (GWCL) and Messrs Befesa Limited was set up to milk the country.

He said had it not been for contractual obligations, he would have terminated the project contract if he had his way.

Speaking on the topic "Making State Enterprises Profitable and Resilient", Asabee said "Why would you want to desalinate seawater when you have clean water bodies like the Volta that has been dammed at Akosombo and, you can even supply to Togo if you are serious. It is terrible, if I had my way, I’ll cancel it."

"The deal was set up in a way to milk the system. Why would you want to change seawater and it’s not like we are in a desert. I can understand Libya or Israel will go in for such a deal but we have a lot of water bodies in Ghana so you cannot develop that? he asked.

The Teshie Desalination Plant Agreement was signed between the GWCL and Befessa on a build, own, operate and transfer (BOOT) basis in February 2011.

The plant was built in February 2015 to address water supply shortfalls, particularly in the Teshie-Nungua area.

The GWCL water desalination project falls under the Accra East Region of the Ghana Water Company’s operations.

In 2011, the Government of Ghana awarded a contract to Befesa Desalination Development Ghana for the establishment of the seawater treatment plant to produce clean water, which will be channeled into the pipelines of GWCL.

Messrs Befesa Limited, an engineering firm, was contracted by the government to build the desalination plant, operate to defray its cost, and hand over to the GWCL after 25 years.

The project was executed by Abengoa, a Spanish company, and Sojitz Corporation, Japan’s largest importer of rare earth metals. The two hold 94% equity in the project.

The total cost of the project is known to be $126 million. The project is a Build, Operate, Own and Transfer project, spanning 25 years, with a revenue forecast of about $1.3 billion over the 25 years.

This public-private partnership arrangement will see Abengoa operate the plant for 25 years, and then transfer its management to GWCL.

But the Asabee believes the contract was inflated adding that the deal was a bad one.

"Why would you, for instance, contract a loan of $275m to develop Terminal 3 when it could have even built a brand new airport? So you go and contract and commit the state entity without talking to them and then you give them a legacy debt, then you tell them to turn things around.

"The policy direction must be correct and this why President Akufo-Addo has said you cannot go and do anything without talking to the central body that oversees the institution's activities," he added.