An expert in energy matters, Kojo Nsafoa-Poku, is asking Ghanaians to look no where further than the doorsteps of the Parliament of Ghana for causing the country a great disservice in the approval of the ECG-PDS takeover agreement.
He want Ghanaians to blame Members of Parliament (MPs) belonging to the New Patriotic Party (NPP) and the National Democratic Congress (NDC) who served on the Joint Committees of Mines and Energy and Finance that considered the Lease and Assignment Agreement as well as the Bulk Supply Agreement in the privatization of the Electricity Company of Ghana (ECG).
In the view of Mr. Nsafoa-Poku, the parliamentarians did a shoddy work in the approval of the deal which has resulted in the government parting ways with Meralco, the Philippino Company that was selected as the concessionaire and which had 30% shares in Power Distribution Servicer (PDS).
The other shareholders in PDS are AEnergia S. A. (Angola) – 19% shares, GTS Engineering Services of Ghana, Santa Baron Ventures of Ghana and TG Energy of Ghana put together 51% shares.
Interacting with Accra-based Neat FM, monitored by Kasapafmonline.ccom Monday, October 21, 2019, the energy expert said several letters he together with some civil society organisations wrote to the Joint Committees of Mines and Energy and Finance cautioning them about the deal fell on deaf ears.
He is therefore not surprised that the ECG-PDS deal has been terminated by President, an action he considered was the best from the number one citizen of the land.
The PDS concession was canceled by the Akufo-Addo government in a statement dated Friday, October 18 signed by the Minister of Finance, Ken Ofori Atta which announced the termination of the 25-year power concession agreement with PDS over irregularities found with the company’s demand guarantee.
The government had earlier in August 2019 announced a suspension of the contract but PDS continued to operate even though they were not in charge of power distribution.
“At the beginning we warned that the agreement per Article 3.2 which spells out the Payment Guarantees was not the best. Per best practices, the company should have given the payment guarantees to ECG before going ahead to commence their operations. However, they were given the green light to commence their operations before submitting payment guarantees. This we saw was going to give the country problems and so I am not surprised that what we warned against has come to pass. So, the government was right to abrogate the contract and if there is anybody to blame, I will blame the Parliamentarians”, he noted.
He added “In this country, we have all agreed to practice democracy. We have three arms of government – Executive, Legislature and Judiciary. The Executive does so many things. Our parliamentarians must be up and doing. If you look at this PDS debacle, the Joint Select Committees on Mines and Energy and Finance, which was chaired by Dr. Mark Assibey-Yeboah and Gyamfi did shoddy work. I was so disappointed the committee from the very first day they started considering the agreement. When we studied the memorandum of the contract agreement, at that time they had not inserted this 51%. When Meralco won the bid, at that time the government had not arranged for this 51% local content in the agreement – in the agreement, there is something called RFP which is the Request for Proposal – in that request the 51% local content was not included. When they did the tender the Ghanaian Consortium wasn’t part of it. It was after Meralco had won the bid that they factored the Ghanaian consortium into the whole deal for them take up the 51%.
Kojo Poku furthered: “With this Ghanaian consortium, nobody assessed them, no due diligence was conducted on their operations but was added to the deal. So some of us wrote to the Committee jointly chaired by Gyamfi and Assibey-Yeboah and cautioned them about the implications of what they are doing but they didn’t listen and went ahead to approve the deal. If you look at the deal which was approved, you can see lots of loopholes. It gave the parties some power to change certain things in the agreement without coming back to Parliament. Article 2.6 of the agreement gives them the power to vary the conditions precedent. I want the Parliamentarians to listen and pay attention to details in the discharge of their duties. You can see that the agreement they passed, they didn’t understand it”.