Minister Coughs Up $12m

The Attorney-General and Minister of Justice, Marietta Brew Appiah-Oppong, yesterday failed to give details to the media of a case before the International Court of Arbitration in The Hague in which Government was asked to pay an amount of $12 million to Balkan Energy Company (BEC) for abrogating the disputed Osagyefo Barge contract.

Ms Appiah-Oppong, who confirmed the ruling by the Court of Arbitration at a press briefing, declined to give details of the case, even though Mahama Ayariga, Minister of Information and Media Relations, said only $12 million was awarded against Ghana, but it was not judgment debt.

“I am bound by the rules of the arbitration not to disclose the details of the arbitration,” she told the media in a hurriedly organized press conference.

The International Court of Arbitration in The Hague, The Netherlands, on Tuesday pronounced judgment on the disputed Osagyefo Barge which has for years been idling away at Effasu in the Western Region, as a result of a long-running battle between the Government and Balkan Energy over certain contractual terms.

Although Balkan Energy was claiming almost $2 billion for the abrogation of the contract, the source said the court took cognizance of some rulings by Ghana’s Supreme Court on some cases to slash down the demand to “just” $12 million.

The New Crusading Guide newspaper, in a recent report, said Ghana was “down and out” as far as the case was concerned.

The Attorney-General, however, disagreed with the Crusading Guide report saying, “Ghana is not down and out.”

She said government would liaise with its external solicitors to take a second look at the judgment.

However, Mrs. Appiah-Oppong said the Osagyefo Barge still remained the property of Ghana.

Mahama Ayariga also said, “The New Crusading Guide story is not true and Ghanaians should not believe it.”

He continued, “All we are saying is that Ghana is not down and out. The case is still at court and we will pursue it to the end. Ghana is not paying $12 million to BEC.”

However, in an interview with Citi FM on Eyewitness News in the evening, Mr. Ayariga said Ghana would still have paid the $12 million, even if it had not gone to court, because the money was the claim put up by Balkan for job done.

Meanwhile, the Attorney-General, in a statement released last night, said the Permanent Court of Arbitration in a substantial decision issued on Tuesday April 1, 2014, rejected claims against the Government of Ghana brought by project developer Balkan Energy (Ghana) Limited, an affiliate of Texas-based Balkan Energy Company.

Mrs. Appiah-Oppong, who signed the release, said Balkan had claimed damages totalling more than $3 billion based on a tolling fee provision in a long-term Power Purchase Agreement (PPA) entered into in 2007 between Balkan and the Ministry of Energy.

While upholding the validity of the PPA, she said the tribunal found that Balkan had failed to perform its obligations under the agreement which required Balkan to refurbish and commission the Osagyefo Power Barge, a-125 MW dual fire-powered barge and associated facilities at Effasu.

The Attorney-General said the tribunal also rejected Balkan’s claim for over $40 million in damages for “unjust enrichment.”

“The tribunal concluded that the evidence did not demonstrate that Balkan had conferred any demonstrable benefit on the Government.

“Instead, it awarded Balkan limited damages of $12 million for work performed and rejected the bulk of Balkan’s claim of alleged expenditures,” she said.

Mrs. Appiah-Oppong said finally, the tribunal held that the PPA was terminated and returned control of the Barge to the government.

“The government was further awarded $300,000 in damages, the maximum amount of damages that it could award the government under the PPA,” she said.

Mrs. Appiah-Oppong said the tribunal determined that the costs of the arbitration were to be shared between the parties.