MERALCO, THE Philippino company
that is part of the companies in charge of power distribution in Ghana, is
planning to pull out its investment from the country’s electricity distribution
utility.
A Manila-based news portal,
The Philippine Star, on Friday said a top official of Meralco said the
decision to pull out from Ghana would happen unless the political situation
in the country improves.
“We’re still waiting for
developments. It’s a Ghana government issue,” Meralco President and CEO, Ray
Espinosa is quoted by the news portal.
According to the news website,
Espinosa fears that the Meralco deal is exposed to political risk following the
suspension of concessionaire agreement between the Government of Ghana and
Power Distribution Services (PDS).
“The terms are good, but if we
will be exposed to these types of uncertainties, we might as well pull out and
just devote our attention to the country. And even in Asia, it’s more stable.
Maybe we don’t have the DNA for that kind of risk in Africa yet,” Espinosa is
quoted by The Philippine Star.
The Government of Ghana in July
– suspended the concession for the operation and maintenance of the assets and
facilities of the Electricity Company of Ghana (ECG) awarded to PDS.
PDS is a consortium between
Meralco through Meridian Power Ventures Ltd. (30 per cent), Angola-based firm
AEnergia SA (19 per cent), and three Ghanaian firms namely TG Energy Solution
Ghana (18 per cent); GTS Engineering Ghana Ltd. (10 per cent); TBK Ghana Ltd.
(10 per cent).
The suspension order was due to
alleged material breaches in the provision of the demand guarantees by PDS,
which were key prerequisites for the turnover of the assets and facilities.
But a week after the
suspension, ECG and PDS agreed on an interim arrangement where the Meralco-led
consortium would still continue activities related to the retail of electricity
to ensure continued power supply and service to consumers.
These activities include meter
reading, billing and distribution of bills, bill reconciliation, revenue
collection and new service connections.
It will also still be
responsible for disconnections and reconnections, faulty meter replacements,
network faults and repairs, complaints and fault reporting to the call centres
and any other related service.
The Meralco-led PDS signed the
concession agreement with ECG on March 1, a year after Millennium Development
Authority (MiDA) chose Meralco as the preferred bidder for private sector
participation in ECG and the Parliament of Ghana approved the 20-year-concession
agreement.
Under the agreement, ECG’s
assets would be leased to the PDS for 20 years, while the ECG would become an
asset holding company.
Meralco said the PDS Consortium
had planned to invest over $580 million for capital expenditures to strengthen
the governance, management and operations of the ECG and improve the delivery
of power to end-users as well as support Ghana’s socio-economic growth.
After the end of the
concession, all assets would be transferred back to ECG, it said.
– Myjoyonline
