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General News of Wednesday, 31 July 2019

Source: classfmonline.com

PDS fiasco: If deal must be terminated, we will – Oppong Nkrumah

Suspending Ghana’s concession agreement with Power Distribution Services (Limited) is a move by the government to secure the interest and assets of the state, the country’s Information Minister Kojo Oppong Nkrumah has said.

Speaking to Benjamin Akakpo on the Executive Breakfast Show (EBS) on Class91.3FM on Wednesday, 31 July 2019, Mr Nkrumah explained that: “The concessionaire met the condition precedent, prima facie, then, as part of continuous due diligence, which is ongoing, the Ghana side has had reasons to raise red flags about, particularly, payment guarantees that were submitted and, as a result of those red flags, it has proceeded to move to secure the interest and the assets of the state by suspending the concession agreement while a full-scale inquiry goes on.

“At the end of that full-scale inquiry, if this agreement needs to be terminated, we’ll be informed about it accordingly. The most important thing is that right now, the most important step, which is to secure the interest of the state and the asset of the state, is what has been occasioned and it is our expectation that as that full-scale inquiry goes on, whatever the outcome is, all of us will be made aware. As of now, ECG is in full control and is ensuring that the distribution, billing and connection services go on smoothly.”

Mr Nkrumah’s explanation comes on the back of the government’s decision to suspend PDS’ contract with the state.

A statement signed by Mr Nkrumah to that effect said the action to put the agreement on hold was necessitated by “the detection of fundamental and material breaches of PDS’ obligation in the provision of Payment Securities (Demand Guarantees) for the transaction which have been discovered upon further due diligence”.

The government said a full probe has been initiated into the deal and steps have been taken to ensure that “distribution, billing and payment services continue uninterrupted”.

The public has been assured that the development “will not interfere with the distribution of electricity services to customers”.

PDS took over the operations of the Electricity Company of Ghana (ECG) on 1 March 2019 with an expected capital injection of GHS900 million.