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GNPC issues $50m guarantee for power barges

  • SOURCE: | qwesa2big
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    The Ghana National Petroleum Corporation (GNPC) has issued half of the $100 million guarantee required to provide financial security for two emergency power barges to be dispatched from Turkey to the country next month.

    Documents on the remaining $50 million are being processed with a local bank and should be completed in the next few weeks, the Chief Executive Officer (CEO) of the corporation, Mr Alex Mould, told the Daily Graphic in an interview.

    The $100-million guarantee for the emergency barges, expected to generate and add 450 megawatts (MW) of power to the national grid, is needed to serve as insurance against possible default in payment by the country.

    Its issuance is, therefore, key to the successful shipment of the barges by KarPower of Turkey to Ghana.

    While contradicting recent concerns expressed by the public that the GNPC had been unable to provide the necessary guarantee to allow for the barges to be brought in, Mr Mould said the first tranche of the $100-million guarantee was issued by the corporation some “months ago” after discussions on the first barge were completed.

    That guarantee, he said, was done by Ecobank Ghana Limited.

    “There are discussions between the Electricity Company of Ghana (ECG) and KarPower on the second barge. When they finish that, we will issue the second guarantee,” he said on the sidelines of a send-off get-together for 46 beneficiaries of the GNPC Oil and Gas Learning Foundation (GNPC OGLF).

    “It’s absolutely not true that the GNPC hasn’t provided the money and it is absolutely not true that the barges are coming in September. My understanding is that they are supposed to leave Turkey in September and so they will be coming (to Ghana) in October. Secondly, the GNPC has put the money aside for the guarantees,” he added.

    Fighting ‘Dumsor’

    The shipment of the two barges was part of a $1.2-billion deal entered into between the country and KarPowership Ghana Limited earlier this year.

    The deal was part of a number of initiatives the government called short and medium-term solutions to the current power challenges facing the country.

    The two ships are expected to produce a total of 450MW of power using gas from the Jubilee Field to augment the national grid.

    Given the impact of the power challenges, locally referred to as ‘dumsor’, interest in the barges has been high, with many arrival dates bandied around.

    Discussions on the arrival of the barges and the financial guarantee were reignited recently, causing some people to speculate that the GNPC had failed to honour the financial obligation needed before the barges could be allowed in.

    Mr Mould said those concerns were unfounded, given that KarPowership was not requesting payment but a guarantee, which was often issued through banks.

    “It doesn’t have to be in any escrow account; I just have to give a guarantee. It’s the relationship I have with my bank — if I ask them to give a guarantee, then they will give it. Nobody has asked for any escrow account,” he said.

    Scholarship beneficiaries

    The GNPC OGLF is a scholarship programme introduced in the 2012/13 academic year to help develop human capital for the country’s nascent petroleum sector.

    So far, 135 people have benefited from the programme, which is coordinated by the GNPC OGLF, a wholly owned subsidiary of the corporation in charge of capacity building.

    The latest beneficiaries, comprising 34 males and 12 females, are due to leave the country for foreign universities later in the year, where they will pursue master’s degree programmes in the petroleum sector.

    Mr Mould said the corporation was committed to developing the right human resource for the sector and would, therefore, be funding more of such initiatives in the future.

    “We identified gaps in the industry and these are frontier staff that we are training. We are doing cutting-edge engineering and petro-science and so we need to develop the requisite staff,” he added.


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