Finance Ministry fails to honour $50m debt owed GNPC since 2014

The Ghana National Petroleum Corporation (GNPC) has still not received payment for the $50 million loan advanced to the Ministry of Finance (MoF) in 2014 for the construction of the Western Corridor roads, in the Atuabo Gas Processing Plant enclave.

The money was expected to have been repaid in three months after disbursement.  This was disclosed in the semi-annual report of the Public Interest and Accountability Committee (PIAC).

The issue have been a concern to PIAC since the deadline for repayment has elapsed without any intervention from the Ministry of Finance to settle the debt.

In PIAC’s engagement with Parliament over the last two years, Parliament directed that the Ministry of Finance and GNPC meet to resolve this outstanding issue.

According to GNPC, the Minister for Energy requested the Minister for Finance to intervene and assist in the settlement of monies owed GNPC by government and other Energy Sector Agencies.

This was contained in a letter to the Ministry of Finance in February 2021.

However, according to the Finance Ministry, it is yet to receive the said letter as claimed by the Ministry of Energy to inform the appropriate action on the fund.

Prior to this, the Ministry of Finance in 2018 directed GNPC to expunge the amount from its books, on the grounds that per the Earmarked Funds Capping and Realignment Act, 2017 (Act 947), the Minister of Finance is empowered to cap all earmarked funds at 25% of tax revenues.

The Ministry also indicated that the government had not retained GNPC‘s flows this far, with the view to offsetting the $50 million loan.

In its response to PIAC on the matter, GNPC said it plans to engage its sector Ministry and Select Committee on Mines & Energy to discuss the issue further when parliament reconvenes.

Meanwhile, the PIAC 2021 Semi Annual report also revealed that the country’s total petroleum agreement as at the time of preparing the report stands at 18.

However, the process has begun for the termination of agreements of four non-performing contractors namely: Swiss African Oil Company Limited, UB Resources, Brittania U, and Sahara Energy Fields Ghana Limited.