Ghana faces $7bn judgement debt

The Minority in Parliament has said it is gravely concerned about the protracted impasse between ENI/Vitol and Springfield Ghana which it believes would result in a $7 billion judgement debt against the Government of Ghana.

According to the moinority caucus, the said impasse was occasioned from a directive by then Minister of Energy, Mr. John Peter Amewu, instructing the two parties to execute a Unitisation and Unit Operating Agreement (UUOA) at the Sankofa and Afina fields.

The caucus disclosed that the impasse has created a bitter legal dispute resulting in a Ghanaian court order directing ENI/Vitol to deposit 30% of its monthly revenue into an escrow account pending unitisation.

“We are also aware that ENI/Vitol has commenced legal action in the International Court of Arbitration seeking damages of about $7 billion against the Government of Ghana”, said a statement signed by John Abdulai Jinapor, a Ranking Member on the Mines and Energy Committee.

The statement thus called on President Akufo-Addo to intervene before its too late.

“We, therefore, call on the Government and President Akuffo-Addo in particular to, as a matter of urgency, intervene in this matter and help find an amicable solution to the impasse, before the $7 billion judgement debt matures into a pain on the neck of the already burdened Ghanaian taxpayer.”

For Immediate Release

31/07/2022

GHANA FACES $7 BILLION JUDGEMENT DEBT

The Minority in Parliament has noted with grave concern, the protracted impasse between ENI/Vitol and Springfield Ghana, which was occasioned from a directive by then Minister of Energy, Mr. John Peter Amewu, instructing the two parties to execute a Unitisation and Unit Operating Agreement (UUOA) at the Sankofa and Afina fields.

ENI/Vitol has since challenged the decision of the Minister insisting that the decision was premature and did not meet industry standards leading to a stalemate in the implementation of the directive.

We note that the current impasse has also led to a bitter legal dispute resulting in a Ghanaian court order directing ENI/Vitol to deposit 30% of its monthly revenue into an escrow account pending unitisation.

We are also aware that ENI/Vitol has commenced legal action in the International Court of Arbitration seeking damages of about $7 billion against the Government of Ghana.

The Minority is very much concerned about the increasing negative impact this avoidable dispute is creating in the upstream petroleum sector especially its implications for attracting giant oil players to invest in Ghana; bearing in mind that ENI is considered the 4th largest oil producer in the world.

It should be noted that the Unitisation process has been so poorly managed that Ghana’s reputation has been hugely tainted in the oil and gas sector.

Indeed, since assuming office in 2017, the Akuffo-Addo/Bawumiah led Government has not successfully executed a single block agreement, neither has any new oil field been brought into production.

We, therefore, call on the Government and President Akuffo-Addo in particular to, as a matter of urgency, intervene in this matter and help find an amicable solution to the impasse, before the $7 billion judgement debt matures into a pain on the neck of the already burdened Ghanaian taxpayer.

The three producing fields bequeathed to this government by the NDC will be depleted in the nest 10-15 years and requires urgent steps to increase Ghana’s reserves.

Times are indeed hard, with the government struggling to raise revenue.

So, the last thing the government should be contemplating is to watch their reckless decision to wilfully cause Ghanaians an avoidable judgement debt to a gargantuan tune of $7 billion.

The dispute with ENI requires tactful leadership which is unfortunately not forthcoming from this government.

We hope the President will listen to this caution from the Minority and take the appropriate steps to save the Ghanaian Taxpayer $7billion.

Thank you

Signed
Hon. John Abdulai Jinapor (MP)
Yapei-Kusawgu Constituency
(Ranking Member-Mines and Energy Committee)