Former Deputy Minister of Energy and Petroleum in the immediate past John Mahama-led administration, John Abdulai Jinapor says he is unaware of any committee tasked to probe the controversial AMERI Power Agreement.
A 17-member ministerial committee led by lawyer Philip Addison in their report published by ‘The New Statesman" Newspaper concluded that the deal was not only grossly unfair to the interest of Ghana, but could also be considered as fraud.
Based on the observations of the Committee, it has recommended that Ameri Energy should be invited back to the negotiation table to rectify the anomalies in the agreement and “for Government of Ghana to aim to claw back a substantial portion of the over US$150million commission.”
In the event that Ameri Energy refuses to come to the negotiation table, the committee chairman recommends that the “Government of Ghana should repudiate the Agreement on the grounds of fraud.”
The Minister for Energy, Boakye Agyarko, inaugurated the 17-member Committee on February 01, 2017 to review, restructure and recommend areas for amendment of the BOOT Agreement.
However, John Abdulai Jinapor in an interview with NEAT FM’s morning show ‘Ghana Montie’ disagrees with the committee’s report after describing it as “inaccurate and political”.
“The paper that even published the report is affiliated to the NPP so you shouldn’t be surprised because it’s a bit political and jaundiced. I am not aware of any committee and none of the committee members called me or my boss [Dr Kwabena Donkor] then for interrogations. I don’t know where this report is coming from. Its inaccurate,” he told host Kwesi Aboagye.
Below is The New Statement Newspaper publication
AMERI POWER DEAL FRAUDULENT - Addison committee calls for re-negotiation
A 17-member ministerial committee tasked to probe the controversial AMERI Power Agreement, questionably procured by the previous National Democratic Congress government through sole sourcing, has concluded that the deal was not only grossly unfair to the interest of Ghana, but could also be considered as fraud.
Based on the observations of the Committee, it has recommended that Ameri Energy should be invited back to the negotiation table to rectify the anomalies in the agreement and “for Government of Ghana to aim to claw back a substantial portion of the over US$150million commission.”
In the event that Ameri Energy refuses to come to the negotiation table, the committee, chaired by Philip Addisson, a private legal practitioner, recommends that the “Government of Ghana should repudiate the Agreement on the grounds of fraud.”
The Minister for Energy, Boakye Agyarko, inaugurated the 17-member Committee on February 01, 2017 to review, restructure and recommend areas for amendment of the BOOT Agreement.
The action was informed by issues raised by stakeholders and the citizenry in respect of the terms of the Agreement.
The Committee was tasked to re-examine the Agreement and make recommendations to the Minister and if need be, restructure the BOOT Agreement to ensure that the terms of the Agreement were in the best interest of Ghana.
The Committee reviewed the Agreement based on its technical, financial and legal merits/demerits and identified issues that should form the basis for re-negotiation with Ameri Energy.
It came to the notice of the Committee that the whole project was executed and financed by PPR, a Turkish registered company, at a price that was considerably lower than that agreed between the Government of Ghana and Ameri Energy, under the Build Own Operate Transfer (BOOT) Agreement.
Another significant recommendation of the Committee contained in its final report, a copy of which is in the possession of the Daily Statesman, is that “henceforth no Power Purchasing Agreement should be entered into by any public utility unless it is as a result of a full competitive bidding process.”
A revealing observation made by the committee is the fact that the Attorney General’s Department, then headed by Marietta Brew Appiah-Oppong, did not give a legal opinion on the deal.
No due diligence was carried out on Africa and Middle East Resources Investment Group LLC (Ameri Group), as well as Ameri Energy Power Equipment Trading LLC (Ameri Equipment). Consequently, Government has no information on the shareholders and directors on either company, the report said.
Moreover, the NDC government approved a wide exemption of taxes for Ameri and its third parties. Basically, Ameri and all its affiliates and sub-contractors and third parties are not liable to pay any form of tax whatsoever in the country.
In its failed bid to resolve the power crisis (dumsor), the NDC government entered into a BOOT agreement with Africa & Middle East Resources Investment Group LLC (“Ameri Energy”) on February 10, 2015 to help reduce the power supply deficit at the time.
The agreement was signed on the basis of emergency and was expected to be delivered within 90 days after the fulfillment of conditions precedent. However, “the delay in implementing the BOOT Agreement defeated its classification as an emergency project,” the report noted.
According to the report, Ameri Energy is making a commission in the sum of US$ 150 million over the five-year term of the Agreement. Additionally, the Agreement incorporates a variable charge of $0.005 cents per kilowatt hour which totals $16.6m.
“While the rate is reasonable the total annual fixed figure of $16.6m is erroneous. Thus Ameri’s actual commission is significantly higher than US$150 million,” the report noted, adding: “these figures must be reconciled and renegotiated to reduce the overall financial obligation on GoG and render the Agreement more equitable.”
Currently, under the BOOT Agreement, Ghana pays USD8.5million as take-or-pay charges on a monthly basis, irrespective of whether power is delivered or not, hence the committee recommending a review.
The report continued: “Amendments to the Boot Agreement require parliamentary approval. The Addendum contains provisions that have significant impact on the project. One such provision is the assignment of the Agreement from Ameri Energy to Ameri Power Equipment Trading LLC. The failure to obtain parliamentary approval renders the Addendum void.”
It added: “The assignment from Ameri Group to Ameri Equipment was carried out without GOGs consent in spite of an express requirement to seek prior consent in the contract. Furthermore, the date of the Assignment precedes the addendum and yet the party that entered into the addendum is the Ameri Group.”
The committee found out that the PriceWaterhouseCooper’s Value for Money audit report did not highlight the key flaws with the project. It also did not state PWC’s professional opinion on the financial viability of the project. The Committee noted that on the date the VFM was presented, the BOOT Agreement had already been signed.
Indeed, the Committee expressed deep concern about the PWC report, as most of the documentation reviewed for the report was not correctly interpreted nor were “apples compared with apples”.
Further, “The wording of the Standby Letter of Credit (SBLC) established, differs significantly from that contained in the Agreement that went to Parliament. Secondly, the wording of the SBLC is too wide as it gives Ameri the opportunity to withdraw all $51million after collecting the required payments. There is no requirement to give notice to GOG before calling on the SBLC.”
“As it stands GoG is simply relying on Ameri’s goodwill not to draw on the SBLC because Ameri can, for example, call on the SBLC even when there is a genuine invoice dispute between the parties to the BOOT Agreement,” the report added.
The report revealed that “Ameri does not have any incentive to generate the full 230 MW contractual capacity” and this is because the BOOT Agreement did not make provision for annual capacity adjustments with penalties in the payment of capacity charges on a pro rata basis in accordance with standard industry practice.
The report recalled that in 2014, Ghana experienced significant deficit in power generation, leading to nationwide load shedding. The Volta River Authority, on behalf of Government of Ghana signed a Letter of Intent with Ameri Energy, dated 23rd December, 2014 for the establishment of a rental of 300MW power generation facility to be located at Takoradi.
This was done on a sole-sourced basis after a meeting between former President John Dramani Mahama and the Crown Prince of Dubai.
In accordance with the terms of the LOI, the government was required to pay a fixed monthly charge of US$ 785,000 per mobile dual fuel aero-derivative gas turbine on a take or pay basis and a Variable Charge of US$0.005 per kilowatt-hour generated.
On January 5, 2015, Ameri Energy forwarded a revised proposal for a 5-year Build Operate-Transfer option for 250 MW fast track generation, with a new Fixed Monthly Charge of US$850,000. The target date for the full deployment of the units was end of first quarter 2015.
By a letter dated January 9, 2015, the VRA made reference to a proposal jointly submitted by Ameri Energy and APR Energy (with Ameri Energy as the developer and APR Energy as the EPC and O&M Contractor) at the request of the government.
It was agreed also that the power plant would be sited at Takoradi to utilize gas from the Jubilee field which at the time was being re-injected and adversely affecting crude oil Final Report 7 production. At the time, the existing thermal plant in Takoradi could not fully utilize the gas, hence the need to procure and install plants that could utilize the gas.
It will be recalled that in the early days of this year, executives of the Senior Staff Association of the Volta River Authority stormed the House of Parliament to demand the abrogation of the Ameri BOOT deal. The workers believed that the deal ‘stinks’ and thus should be discontinued.
Source: King Edward Ambrose Washman Addo/Peacefmonline.com/ Twitter: @Washman5/ Instagram: Washman007
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You will be called very soon wai.
Is this man not talking too much?
John Jinapor, is it true Ex Prez Mahama has impregnated your wife?
I don't think the committee recommended that any of the Ghanaian official's who spearheaded this deal should be prosecuted. All they said was to renegotiate the deal with Ameri, so where are the inaccuracies and the political thing Mr. Jinapo is referring too. Some leaders of our time, protecting foreign businesses to the detriment of the country. Hmmmmmmmm time will tell.
Why don't we just terminate the Ameri deal and send the Generator back to where it came from. After all we don't need it anymore because John Mahama is not in Power.
Ghanaians do not even need a committee to tell them that, that Ameri Deal was a stinker. From day 1 when the Norwegian journalist boarded a plane at his own expense to warn us that one of the cr00ks in the deal was wanted in Europe and was on the run did anyone pay any attention?When low-lives like this John Jinapor are made ministers what do you expect? And who the f* ck does he think he is that the current minister should consult him before setting up a committee?Just look at the amount of money we are simply 'dashing' these cr1m1nals?If Mahama had been allowed to steal this election Ghana would have been finished totally.These people must really hate Ghanaians.
Oh Ghana. John Jinapor should be investigated right away. He should stop that childish takashie strategy he has adopted
You were nobody until you started speaking for John Mahama as Vice President in 2009. When he started travelling with you to buy planes in Brazil and Europe you also starting buying houses and paying cash for them. Houses at East Legon, Trasacco, Tema Community 10 and buying a plot of land at community 12 for USD200,000 and building a USD1million house in four months. You also opened a micro-finance company at Community 4 for your wife, all in a couple of years working as a deputy minister. You also bought a piece of land about 3 acres at the community 9 light industrial area for a pittance and sold to CFAO for USD4million. Because you were making dirty money and amassing wealth you have no respect for elders and always behave as if there is no tomorrow. The day of reckoning has surely come.
hey hey hey , jinapore hold it there, we dont need you to be aware before a committee is inaugurated or start work neither do we need your side before recommendations are done., its a committee, findings are made, its not court, once it gets to court, you can file ya defence., if you guys know the sort of people to handle ya corruption, you ppl would have thought wise enough to return the booties like done in nigeria., the deputy prosecutor general, PHILIP ADDISSON committee has finish it work, you use your lithur to meet in court. , i want nana jail you greed bust.,ard than to even govern well, awifoo, akronfoo., you guys even couldnt see naadu mills to , look at the plight and sadness you have made the woman go through. ADDISSON & AKOTO AMPAW with GLORIA AKUFO & GODFRED DAME are coming, NDC corrupt official, mon gina yie
Abu Jinapo, in conducting investigations of which you and your colleague are involved, the investigators have the right not to indulge you or seek your part of the story if evidences available are substantially enough. Again, once the report has been submitted, you can be called to explain certain questions which will determine whether charges of fraud or causing financial loss to the state needs to be charged against you and your colleague. Abu, it will be in your interest to keep quiet and not go public to contracdict yourself because whatever you say now, will be taken on against you.