The Ghana Gas Senior Staff Association (GGSA) is demanding the immediate payment of debts due Ghana Gas by the Electricity Company of Ghana (ECG) to help avert a possible return to the era of intermittent power outages popularly known as ‘dumsor’.
According to GGSA, there is a concerning trend that has emerged within Ghana’s Energy Sector – the inability of the Electricity Company of Ghana (ECG) to settle its obligations to various State-Owned Enterprises (SOEs), with the Ghana National Gas Company (Ghana Gas) standing out as a critical victim of this financial neglect.
In a letter to the ECG and copied to the Minister of Energy, the Board Chairman and CEO of Ghana Gas, the Senior Staff of the company states “This issue not only raises questions about financial prudence, but also poses a significant threat to the stability and operations of Ghana Gas, a cornerstone of the nation’s Energy Sector.”
In recent times, the Electricity Company of Ghana has come under intense pressure for its failure to meet financial obligations to state-owned enterprises, as well as other private players in the value chain, especially after it made some motorbikes donation to the Ghana Police Service.
The workers of the gas processing company are thus warning that “the repercussions of ECG’s non-payment are far-reaching and could potentially disrupt the delicate balance within the energy sector”.
According to the Senior Staff of Ghana Gas, the International Monetary Fund (IMF) conditionality emphasized the timely payments to state-owned enterprises in the energy sector, adding that ECG’s departure from these guidelines raises concerns about the overall financial discipline within the sector and undermines the efforts to align with international best practices.
“The failure to adhere to IMF conditionality jeopardizes Ghana’s economic credibility and stability, potentially affecting investor confidence in the Energy Sector. Compounding the issue are directives from the highest echelons of Ghana’s leadership the President and Vice President emphasizing the importance of timely payments to state-owned enterprises.
“Despite these directives, ECG’s non-compliance persists, leading to a situation where critical entities like Ghana Gas are left in financial limbo, struggling to fulfill their obligations and maintain operational efficiency,” the Ghana Gas Senior Staff explained.
To them, the situation has negatively affected the effective running of Ghana Gas, and the company is likely to struggle to meet its financial obligations to Tullow Oil, the provider of raw gas to the company.
“The financial strain on Ghana Gas not only affects its day-to-day operations but also jeopardizes its ability to meet critical financial commitments, including payments to suppliers such as Tullow, a major provider of raw gas. This situation places Ghana Gas in a Catch, where the very entity it serves fails to reciprocate the necessary financial support.
“The energy sector, a vital component of Ghana’s economic growth, is now at risk of disruption. The inability to settle financial obligations not only hampers Ghana Gas’s ability to maintain infrastructure and operations but also reverberates through the entire energy supply chain, affecting stakeholders and service providers alike,” they wrote.
They are calling for the immediate reinstatement of the Cash Water Fall Mechanism – a system in which all revenues collected by ECG is paid so all players in the value chain can be paid from – warning that if that is not done, they cannot prevent the imminent ‘dumsor’ starring at Ghanaians in the face.
“We call for prudent actions to reinstate the Cash Water Fall Mechanism and payment of all outstanding invoices due Ghana Gas to give reliable gas supply to prevent power crisis (dumsor) on innocent Ghanaians and the country at Large,” they warn.