Parliament approves off-taker agreement under China loan deal

The ruling NDC lawmakers of Ghana have voted massively to pass the controversial off-taker agreement between the Ghana National Petroleum Corporation (GNPC) and the UNIPEC Asia Company Limited, paving way for the construction of a massive gas infrastructure expected to speed-up the Jubilee natural gas in the Western region.

The House also approved a loan deal worth US$150 million to finance the ICT-enhanced Surveillance and Monitoring Facilities for the Oil and Gas Enclave Project under the Master Facility Agreement (MFA) between the Government of Ghana and the China Development Bank Corporation (CDBC).

Today's approval came days after lawmakers approved a loan deal worth US$850 million to help Ghana to finance the construction of the proposed massive gas plant that will harvest natural gas from oilfields in the deep waters of the Western Region for domestic and industrial use.

The off-taker agreement, which is under the Master Facility Agreement between Ghana and the China Development Bank Corporation, was passed by a voice vote during today's sitting. Whereas ruling National Democratic Congress MPs shouted in support of the agreement, minority MPs abstained.

New Patriotic Party MPs had earlier called for withdrawal of the agreement for a more thorough scrutiny, arguing that the terms of the deal, which among other things require the GNPC to supply 13,000 barrels of jubilee oil per day until the loan amount is fully paid using the nation's crude, could seriously harm Ghana's economic interests in diverse ways.

The NPP MPs also accused the Mills government of seeking to enter into an agreement they argued breached key provisions in the Petroleum Revenue Management Law passed by Parliament last year.

They cited a provision in the agreement, which states that the tenure of the deal is 15 1/2 (fifteen-and-half) years, instead of the 10-year ceiling imposed by the Petroleum Revenue Management Act to back their stance.

But, majority MPs stood firmly behind the deal, insisting that the agreement holds the key to push Ghana into the much trumpeted industrial age promised by the Mills government.

It will be recalled that the government of Ghana entered into a Master Facility Agreement with the China Development Bank Corporation for an amount of $3,000,000,000.00 to finance various infrastructural projects in the country.

Parliament approved the agreement on August 26, 2011. The agreement was subsequently signed by the parties on December 16, 2011 and an Addendum to the Master Facility Agreement also approved on February 21, 2011.

“The MFA requires that the government of Ghana enters into separate subsidiary agreements with CDB in respect of each project to be implemented under the 3 billion dollar facility,” a report of the Joint Parliamentary Committee on Finance and Mines and Energy said.

“Further, Parliament in giving approval for the MFA, directed the Ministry of Finance and Economic Planning to present each subsidiary agreement to the House for approval in accordance with Article 181 of the Constitution and Section 4 of the Loans Act, 1970, Act 335,” the report said.

Source: Citifmonline