ARGUMENTS BY former Chief Executive Officer (CEO) of Ghana National Petroleum Corporation (GNPC) Alex Mould that he did not cause financial loss to the state through the oil deals he negotiated on behalf of the country during his tenure have been challenged.
Sources within GNPC have indicated that Mr. Mould left behind a ‘questionable legacy’ or ‘track record’, especially as he continues to write articles accusing the government of causing financial loss to the state.
Mr. Mould has delivered a couple of public lectures and written articles in which he made damning analysis of the oil and gas deals that the Akufo-Addo administration had entered into on behalf of the state.
He has accused the government of causing financial loss to the state through the Aker Energy deal.
Delivering a keynote address at a public forum organised by Caucus for Democratic Governance, Mr. Mould said, “Considering what GoG stood to gain from the 10% interest, one cannot help but wonder why all options and possibilities were not exhausted before getting to this point. For example, was there any economic analysis done by GNPC to validate why the 10% interest should not be taken up? Was approval sought from the minister who had given GNPC the original approval to pay for the 10% interest in the block? If so, did the minister get his approval from Cabinet? Was the Minister of Finance aware that GNPC had turned down an option to acquire 10% of the block? This is because if the issue alone was that GNPC did not have the funds, then MoF could have been asked to fund on behalf of GoG.”
However, Mr Mould’s assertions have been contested for negotiating a bad deal on behalf of the state in the Sankofa and Quantum deals.
Sources at GNPC said the Sankofa deal was “bloated”, adding Mr. Mould was also a key negotiator of the Quantum Power deal which has been described by many as one of the worst in Ghana’s history.
It continued that the Rosneft deal signed by the incumbent as replacement for the Quantum deal delivered $1 billion in savings on terminal fees alone, had a significant reduction in term from 20 to 12 years and did not require any credit support from GNPC.
Industry experts have suggested that Mr. Mould should be probed regarding the LNG contract he signed with Quantum.
Key among the issued raised were: “Why GNPC signed an agreement with a terminal cost priced at 50% margin to recent market benchmarks; what was the demand and supply rationale in signing a 500 mmscf/d contract with Quantum power a month after signing a 170 mmscf/d contract with Sankofa? Why did GNPC agree to provide Quantum power with credit support in the form of a standby letter of credit?
It is understood from sources within the ministry that Quantum reduced their price by 40% when challenged by the new administration.
Meanwhile, the gas sales agreement signed between the Government of Ghana and the Sankofa partners continues to generate significant controversy.
The high price of delivered gas from the field has negatively impacted government’s attempts to reduce electricity prices.
Current gas deliveries from WAGPCo and future LNG deliveries in 2020 are all expected to be 30-40% cheaper than Sankofa when delivered to customers.
Questions posed by panellists at the meeting have been confirmed by sources at the GNPC.
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