Ghana slapped with $134m judgment debt over cancellation of GCGP power deal
Ghana has been hit with a $134 million judgement debt over the cancellation of its Emergency Power Agreement with GCGP Limited.
The International Court of Arbitration in its ruling on the matter put before it in 2019 also said the judgement debt comes with a $30 million interest payment obligation.
The contract, signed in 2015 was among those cancelled by former Energy Minister, Boakye Agyarko with the reason that they were not needed and were only going to further lead to the ballooning of Ghana’s debts in the energy sector.
The ruling by the International Court of Arbitration ordered the government to Ghana to pay to “GPGC the full value of the Early Termination Payment, together with Mobilization, Demobilization and preservation and maintenance costs in the amount of US$ 134,348,661, together also with interest thereon from 12 November 2018 until the date of payment, accruing daily and compounded monthly, at the rate of LIBOR for six-month US dollar deposits plus six per cent(6%).”
The Government of Ghana was also to pay GPGC an amount of “US$ 309,877.74 in respect of the Costs of the Arbitration, together with US$ 3,000,000 in respect of GPGC’s legal representation and the fees and expenses of its expert witness, together with interest on the aggregate amount of US$ 3,309,877.74 at the rate of LIBOR for three-month US dollar deposits, compounded quarterly.”
Ghana’s Energy Minister in cancelling the deal said the decision was justified because among other things, GPGC had started construction activities on site without siting and construction permits and those activities were illegal.