New AMERI Deal ‘Doesn’t Make Financial Sense’

Social commentator, Sydney Casely Hayford has joined the growing number of groups and individuals who have criticized government over the re-negotiated AMERI deal.

Casely Hayford on Citi TV’s FM's News Analysis Programme, The Big Issue said it makes no “financial sense” for government to sign the agreement, given that Ghana risks paying more when the deal is sealed.

“Why can’t Parliament get private sector’s opinion? I have looked at the contract that was laid before Parliament and I have looked at the new contract that has been laid before Parliament and this seems to me an atrocious deal to sign onto. It does not make financial sense one tiny bit.

“I have also sighted a report from VRA on their analysis of the future development of power that is coming up so it does not make sense to go and trade what should be a $50 million dollar project for a 1.1 dollar billion commitment just because you say it is going to be renegotiated for 15 years.”

Under the new agreement, a new company, Mytilineous International Trading Company, will take over the management of the AMERI power plant for 15 years.

The new company has offered to pay AMERI an amount of $52,160,560, with the government paying the remaining $39 million to the Dubai-based AMERI Energy to wash its hands off the deal entirely.

The agreement covering the new deal was laid before Parliament on Thursday for approval.

Casely Hayford said government needs to conduct checks on the new company taking over the management of the AMERI power plant.

“We need to look at this supposed new company because it appears this new company is just the old company remoulded into something else. Has Parliament asked who is representing the new company in Ghana?”

Parliament has since deferred its consideration of the new deal.

The Majority Leader, Osei Kyei-Mensah-Bonsu explained to the media that this is because the request for further information about the deal is critical.

“People are raising issues about the gains we said we are clawing back… We need to interrogate the figures to know that what we are doing is in the best interests of the country, which explains why [the deal wasn’t considered].”

“I spoke to the Finance Minister, I spoke to the Attorney General plus the Minster of Energy and we all decided to tarry a while and have a closer look at it.”

The John Mahama administration in 2015 signed a contract with Africa and Middle East Resources Investment Group (AMERI) Energy, to rent the 300MW of emergency power from AMERI.

This was at the peak of the country's power crisis.

The power agreement with UAE-based AMERI Energy deal cost $510 million.

But according to the NPP administration, it found out that the government had been shortchanged by AMERI as they presented an overpriced budget, and were overpaid by $150 million.

The new administration thus commenced a renegotiation process to ensure value for money.

Some stakeholders have however raised concerns over the renegotiated deal.

The Africa Centre for Energy Policy (ACEP) wants Parliament to reject the renegotiated AMERI deal.

“We are committing to pay $50m for 15 years which is not on for the Ghanaian public and I hope Parliament will protect the public by rejecting the AMERI amendment,” Executive Director of the Africa Centre for Energy Policy (ACEP), Ben Boakye stated.

The Institute of Energy Security (IES) has also said the country risks paying more when the deal is agreed upon, in its current form.