Business News of 2026-09-23
Government in talks with Befesa to avert $235m payment over Teshie plant
The government says it is negotiating with Befesa to purchase the Teshie desalination plant at a price lower than the $235 million awarded to the company in an international arbitration dispute.
The Office of the Attorney-General and Ministry of Justice said in a statement issued on Wednesday, September 23, 2026, that the government hoped to conclude the negotiations soon and return the plant to full operation.
The statement followed the final award in two related International Chamber of Commerce (ICC) arbitrations involving the Teshie desalination plant.
The first case, ICC Case No. 29029/CPB, was brought by Befesa Desalination Developments Ghana Ltd and Standard Bank of South Africa against Ghana Water Company Limited (GWCL) over the Water Purchase Agreement for the plant.
A parallel arbitration, ICC Case No. 29030/CPB, was brought by Befesa against the Republic of Ghana under a state guarantee.
According to the Attorney-General’s statement, the tribunal found that Befesa had validly terminated the Water Purchase Agreement and that Ghana Water was liable to make contractual termination payments.
Befesa and Standard Bank had initially sought about $402 million under one claim for alleged unpaid charges and approximately $235 million under a second claim relating to termination of the agreement.
However, the tribunal ruled that the two claims could not be recovered cumulatively and dismissed the $402 million claim in its entirety.
It instead awarded $235 million to Befesa and Standard Bank as a termination payment, inclusive of pre-award interest calculated to March 31, 2026.
The award also provides for continuing interest on the debt component from April 1, 2026.
The Attorney-General’s Office said the tribunal’s decision significantly reduced the amount sought by the claimants.
It noted that the $235 million award represented 58.4% of the approximately $402 million monetary claim and, consequently, the claimants were awarded 58.4% of their reasonable legal and representation costs.
The government said it had entered into negotiations with Befesa to purchase the plant even before the final award was issued.
“Significant progress has been made in the negotiations for the purchase of the plant to avoid the payment of the said $235 million,” the statement said.
It added that the proposed purchase would allow the state to take full ownership of the facility without incurring additional costs beyond those required to ensure continued water supply to communities in eastern Accra.
“This purchase will ensure that the state fully owns the plant and does not incur any additional costs beyond what is necessary to guarantee the continued supply of water to about one million residents in the eastern part of Accra,” the statement said.
The government said it hoped to conclude the negotiations “within the shortest possible time” to enable the plant to return to full operation.
The dispute dates back to the Water Purchase Agreement between Ghana Water and Befesa for the supply of desalinated water to Teshie and surrounding communities.
According to the Attorney-General’s Office, the arbitration was commenced by Befesa and Standard Bank on October 23, 2024, following a dispute over payments under the agreement.
The government said the plant’s acquisition would form part of efforts to secure continued water supply to residents in the affected communities.
MA
