Five Members of Parliament (MPs), who sought a judicial review of a law that restricts further expansion of oil and gas facilities at the Takoradi Port, have rejected President Mahama’s recent statement that their action delayed the completion of the Atuabo Free Port. Inaugurating the Atuabo Gas Processing Plant last week, President Mahama said the project delayed because of the court suits which he described as “needless.”
He further called on judges not to entertain law suits that seek to delay national projects. But the 5 MPs say they cannot be blamed for the delays because there has been no court injunction against it.
According to the MP’s the delay is largely because the contractor, Lonrho Ports, is broke.
They said this in a statement signed by MP for Efia Constituency Joseph Cudjoe.
Below is the full statement
Delay in Atuabo Freeport Project
Lonrho Ports Ltd is broke!
Last week, President John Mahama and the Petroleum Minister, Mr Armah Kofi Buah stated publicly that the delay in the start of the Atuabo Freeport project is coming from some Members of Parliament.
These claims are false and misleading. We, the said Members of Parliament state for the records that there is currently no court injunction on the Atuabo Freeport project. Indeed, there is no court action against the project.
These statements are untrue. We challenge government to tell the public the suit numbers of the suit(s) they are attributing the delay to.
It is obvious that the cause of the delay is the inability of government and Lonrho Ports to find the money to finance the project.
We have only written a letter to the Attorney General drawing government’s attention to two important issues relating, NOT to the Atuabo Freeport project, but to the Takoradi Port and the Ghana Ports & Harbours Authority (GPHA). The issues are as follows:
1. Parliament has approved a €197 million loan facility for Takoradi Port to expand and provide oil and gas services to the emerging petroleum business in the Western Region. The Takoradi Port is again in the process of contracting another US$400 million for the purpose of further expanding its facilities to provide oil and gas services.
In spite of these, government and Lonrho have signed an agreement to impose a restriction on the expansion of oil and gas facilities at the Takoradi Port until Lonrho has recovered all of its investment in the Atuabo Freeport and made enough profit. Please refer to Clause 7 of the Atuabo Freport agreement.
If this restriction is allowed to remain, Takoradi Port cannot repay its loans, the Port and related businesses in the Sekondi-Takoradi metropolis will collapse, and the unemployment that will attend this collapse will be unbearable for the nation.
It also needs to be noted that, in anticipation of expanded oil and gas business at the Takoradi Port, both local and foreign businessmen and investors have invested in the residential, commercial and real estate sectors in Sekondi-Takoradi and the surrounding townships. Hotels, restaurants, financial institutions, etc have all invested substantially in the Sekondi-Takoradi metropolis. So the exclusion of Takoradi Port from the oil and gas business poses serious risk to these investors. It would not augur well for Ghana’s investment policy credibility.
We support government’s effort at giving Western Region two ports. We don’t support killing one port to establish another.
2. The second concern we have is the suggestion by Lonrho that, they cannot bring themselves under the regulation of the GPHA, Ghana’s sole regulator of ports.
To please Lonrho, government and Lonrho have put a clause in the Atuabo Freeport agreement that Lonrho would deal with GPHA at arm’s length if at all Lonrho decides to deal with the GPHA. Please refer to Clause 13.2 of the Atuabo Freeport agreement.
This disregard for Ghana’s institutions is wrong and unacceptable.
We take the view that while we seek to resolve these matters regarding the restrictions on Takoradi Port and the regulatory functions of Ghana’s sole regulator of ports (the GPHA), nothing stops Lonrho Ports Ltd from proceeding with the building of the Atuabo Freeport. Once again, we are urging Lonrho to proceed with the project.
If they are having difficulty raising money to start the project, government should be truthful about the causes of the delay.
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