The Member of Parliament (MP) for the Jomoro Constituency, Dorcas Affo-Toffey, has called for a full-scale audit into the disposal and sale of the Osagyefo Power Barge (OPB).
Ms. Affo-Toffey claimed that Misak Limited, a private company introduced by the Ministry of Energy to decommission the barge in 2022 – without proper authorisation and due processes, has significantly dismantled the power barge and sold-off its components.
“What surprises me the most is there has not been any legal action taken against the company that did this illegal act,” she fumed.
The Jomoro MP, who was speaking in parliament, demanded full details of the transaction be made available to the legislative body. She also insisted on the need for transparency in regard to the barge’s sale.
This follows the response to queries on the state of the barge by a Deputy Minister of Energy, William Owuraku Aidoo, which confirmed the facility’s dismantlement without approval by Misak Limited.
He said the Ministry of Energy had directed Ghana National Petroleum Corporation (GNPC) to take over ownership of the barge; but due to a prolonged legal dispute that prevented GNPC from working on the barge, no maintenance activities were performed throughout the arbitration – leading to excessive corrosion and deterioration.
A technical audit in 2019 showed that it was not commercially viable to return OPB to service. This was because the cost of refurbishment was projected to exceed the cost of purchasing a new barge, the minister added.
To dispose of the barge, he noted that the Minister of Energy directed GNPC to engage Misak Company Limited to decommission it – with the private company proposing to give 60 percent of the revenue from sale of the scrap to GNPC and retain 40 percent.
However, it later became evident that Misak Limited had already commenced removing some parts of the barge and other metals without proper recourse, he revealed.
The deputy minister said efforts were however made to ensure that further dismantling parts of the barge was halted until a disposal process was concluded, in line with Public Procurement Authority guidelines for the disposal of goods.
He said: “In line with the Public Procurement Authority guidelines as mentioned above, GNPC constituted a Board of Survey to physically inspect the barge and recommend the best disposal option”.
However, a report by the Board showed that about 90 percent of the OPB had been dismantled, with sources pointing to Misak Limited as being responsible – without engaging GNPC to formalise an agreement as directed by the Minister of Energy.
In view of this, he said the Ministry of Energy will prevail on GNPC to continue with the steps as outlined in the Public Procurement Authority guidelines for the disposal of goods to establish the scrap material’s value.
Furthermore, they are expected to engage Misak Limited to formalise an agreement on sharing revenue from the scrap material among GNPC, the project community and Misak.
Background of the Osagyefo Power Barge (OPB)
The power barge project was initially under the management of Western Power, a subsidiary of GNPC. Responsibility was transferred to the Volta River Authority in 2003. In July 2007, the government of Ghana entered an unsolicited 20-year lease agreement with the company Balkan Energy Ghana to refurbish and operate the power barge, initially using diesel fuel and later using gas to be delivered by the West African Gas Pipeline.
Ghana sought additional electricity supplies from the barge to alleviate electricity shortages resulting from reduced water levels at the Akosombo Dam hydroelectric project.
The Balkan Energy Company promised to begin operations within 90 days. Plans were announced to increase the barge’s generating capacity by 60 MW, bringing it from its then-current capacity of 125 MW up to 185 MW. However, the barge never operated, and the expansion was not completed.
Government sued in a local court, seeking to nullify the contract with Balkan Energy. Balkan Energy blamed ProEnergy, a U.S. company with which it had contracted, for Balkan’s inability to bring the generating station online when promised. Balkan Energy and ProEnergy sued each other in U.S. courts, and the government of Ghana later filed a lawsuit against ProEnergy in U.S. court.
The Ministry of Energy, in a letter dated 16th November 2015 and referenced SCR/DA144/255/01, directed GNPC to take over ownership of the barge.
However, due to the prolonged legal dispute that prevented GNPC from working on the barge, no maintenance activities could be performed throughout the arbitration – leading to the deterioration from excessive corrosion.