The attention of the Ministry of Power has been drawn to publications in the media about project vehicles purchased for the implementation of US$350 million Weldy Lamont Associates Self Help Electrification Project (SHEP) facility and wishes to state the facts as follows:
1. The US$350 million US EXIM facility was a sole sourced agreement.
2. Negotiations for the said facility started in 2006.
3. The facility was given Executive approval by the then President of the Republic of Ghana on 17th July, 2008.
4. Subsequently, Parliament gave its approval for same on 15th August, 2008.
5. Under the US EXIM funded facility (which is being executed by Weldy Lamont Associates) 85% of all project-related materials, including vehicles, must be procured from manufacturers in the United States of America. (Note that the U.S. EXIM facility helps create and maintain U.S. jobs by financing the sale of U.S. exports primarily to emerging markets throughout the world by providing loan guarantees, export credit insurance and direct loans).
6. In line with the agreement, 85% of all project-related materials (including all vehicles) were procured in U.S. models.
7. The said vehicles, which were negotiated as part of the project prior to 2009, were delivered in 2010.
8. In early 2009 when a new Minister of Energy assumed office, he carried out a Value for Money audit as a condition precedent for contract effectiveness.
9. After four rounds of hectic negotiations between the Government of Ghana Team and the contractor, Weldy Lamont (which ended on 30 July, 2009), the price of materials was reviewed downwards, leading to savings of US$46 million.
This resulted in the construction of new substations in Kintampo and Mim as well as the expansion of the Sunyani substation. Local content was also increased from the originally agreed 15% figure to 30%. This enhanced the participation of Ghanaian-owned companies.
10. Originally, the project was intended to benefit 1,200 communities. Following the Value for Money audit in 2009 and reduction in scope of work in some communities, among others, it was expanded to cover 2,130 communities in Ashanti, Brong Ahafo, Western and Central Regions. So far, about one thousand communities have been connected and the project is ongoing.
***END***
EDWARD BAWA
[HEAD OF COMMUNICATIONS]
Source: Peacefmonline.com
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