Ghana’s $100m debt to Nigeria Gas not unusual – Mona Quartey

Deputy finance Minister Mona Quartey has told Morning Starr’s Kafui Dey on Starr 103.5FM that the alleged $100-million debt owed Nigeria Gas by Ghana, if true, is neither “strange” nor “unusual.”

Responding to a claim by former Deputy Governor of the Bank of Ghana, Dr Mahamudu Bawumia that the country’s current power crisis is as a result of the debt owed the Nigerian power firm, thus its dithering in supplying gas to Accra to fuel thermal plants for power production, Mrs Quartey said: “The Government of Ghana, (the Ministry of finance) does not owe Nigeria for gas, most likely one of the agencies, possibly [state power producer Volta River Authority] VRA who buys gas, because the Ministry of finance does not buy gas, but one of the agencies buys gas and if they do, then they will have a credit line, therefore at any point in time, there will be an arrears that they are owing so that is not strange.”

“Maybe Dr Bawumia was talking about the quantum but again considering how much those things cost–oil and gas–to produce energy for us, that amount is not unusual so it is arrears and perhaps they are working on paying that down,” she said.

Pressed by Kafui Dey if she would concede to the figure claimed by the three-time Running Mate to the main opposition New Patriotic Party’s Flagbearer Nana Akufo-Addo, Mrs Quartey said: “…I don’t know that number but I’m just saying that it’s not unusual for that kind of business and, therefore, whichever agency is buying gas to produce electricity, it’s an ongoing process…yes it is a debt but it is not a burning debt.”

At his Tuesday lecture at the Central University College on the economy in general, and the $940-million bailout package from the International Monetary Fund (IMF) in specific, Dr Bawumia said: “The untold story of the erratic gas supply from Nigeria is that Ghana owes Nigeria Gas $100 million.”

“Nigeria Gas is therefore dragging its feet with regards to the supply of gas to Ghana while this amount is unpaid,” he asserted.

Apart from the alleged amount owed Nigeria Gas, Dr Bawumia also said the Government of Ghana is indebted to the VRA to the tune of Ghc1 billion, a situation he observed has crippled the state power producer’s ability to sufficiently produce power for the country. Additionally, Dr Bawumia said the Government owes state power distributor Electricity Company of Ghana (ECG) Ghc700 million, thus worsening the power crisis.

The indebtedness of the Government to the power sector, he analysed, is what has compelled the Akosombo Dam to overuse its water resources by some 30 per cent, a situation that has resulted in the current low water level in the hydropower station.

Ghana is currently shedding between 400 and 700 Megawatts of power during off-peak and peak periods, respectively. The crisis has come about as a result of poor water levels in the three hydropower stations, lack of gas flow from the West Africa Gas Pipeline in Nigeria to thermal plants in Ghana for production as well as the breakdown of some plants. The crisis is taking a toll on Industry, businesses and domestic consumers. Power Minister Dr Kwabena Donkor has promised to resign if he fails to resolve the crisis by the end of December this year.