90% of $110m Osagyefo Power Barge dismantled without  approval  

It has been revealed that 90% of $110m Osagyefo Power Barge (OPB) located at Effasu in Jomoro in the Western Region has been dismantled.

This was done by Misak Limited without engaging Ghana National Petroleum Corporation (GNPC) to format an agreement as directed by the Energy Minister.

A Deputy Minister of Energy William Owuraku Aidoo disclosed this when he briefed parliament on the status of the Osagyefo Power Barge.

He was speaking on the floor of Parliament in his response to a question by Madam Dorcas Toffey, the Member of Parliament (MP) for Jomoro, who asked the Minister what the current state of the OPB, especially in terms of its ownership and condition.

Aidoo explained that the Osagyefo Power Barge project was initially under the management of Western Power, a subsidiary of Ghana National Petroleum Corporation (GNPC) and that the responsibility was transferred to the Volta River Authority (VRA) in 2023.

However, in July 2007, he said the Government of Ghana entered into an unsolicited 20-year lease agreement with the Company Balkan Energy Ghana to refurbish and operate to the power barge, initially using diesel fuel and later using gas to be delivered by the West Africa Gas Pipeline.

He said Ghana sought additional electricity supplies from the Barge to alleviate electricity shortages resulting from reduced water levels at the Akosombo Dam hydroelectric project.

He stated that the Balkans Energy Company promised to begin operations within 90 days, and that plans were announced to increase the barge’s generation capacity by 60 Megawatts (MW), bringing it from its current capacity of 125 MW up to 185MW.

He said however, the barge never operated, and the expansion was not completed.

The Deputy Minister said the Government of Ghana sued in Ghanaian court, seeking to nullify the contract with Balkan Energy and the Balkan Energy blamed ProEnergy, a United States (US) company with which it had contracted, for Balkan’s inability to bring the generating station online when promised.

He said Balkan Energy and ProEnergy sued each other in US courts, and the Government of Ghana later filed a lawsuit against ProEnergy in US court.

On possession of the Barge, Mr Aidoo said the Ministry of Energy, in a letter dated 16th November 2015 and referenced SCR/DA144/255/01, directed GNPC to take over the ownership of the barge.

He said however, due to the prolonged legal dispute, which prevented GNPC from working on the barge, no maintenance activities could be performed throughout the arbitration, leading to the deterioration from excessive corrosion.

Regarding the third-party assessment of the Barge, Mr Aidoo said in a report dated 10th June 2019, the US Agency for International Development (USAID), under its Integrated Resource and Resilience Planning Project, provided an analysis of the status of the OPB.

He said after performing a technical audit on the Barge, USAID, in its report, recommended that it was not commercially viable to return the OPB to service as the cost of refurbishment would likely far exceed the cost of purchasing a new barge.

Concerning the process for disposal of the Barge, the Deputy Minister said GNPC received a proposal through the Ministry of Energy from Sarfo and Stephen Company, dated 2nd March 2021; stating that the GNPC subsequently received an Expression of Interest to decommission the barge through the Ministry of Energy from Misak Limited, date 2nd March 2022.

“In this letter, the Minister directed GNPC to engage Misak Company Limited to decommission the barge and informed GNPC that Misak proposed to give 60 per cent of the revenue from the sale of the scrap to GNPC and retained 40 per cent.” he said.

“Upon receipt of these letters, GNPC visited the barge site, immediate communities and key Government agencies, including the Municipal Chief Executive (MCE) and the Police, on 7th April 2022 to ascertain the condition of the Barge.”

Mr Aidoo said from the interaction with the community, chiefs, MCE, and police it was discovered that Misak had already commenced the removal of some parts of the barge and other metals without proper recourse.

He said the team, therefore, engaged the MCE and Police and requested that further dismantling of part of the barge should be prevented until a disposal process was concluded in line with Public Procurement Authority guidelines for the disposal of goods.

He said the GNPC subsequently wrote to the Ministry in May 2022 to inform that immediate steps would be taken to decommission the Osagyefo Barge in accordance with Section 83 and 84 “Disposal of Stores, Vehicles, Plant and Equipment” of The Public Procurement Act, Act 663 as Amended (Act 914).

He said in line with the Public Procurement Authority guidelines as mentioned above, GNPC constituted a Board of Survey to physically inspect the Barge and recommend the best disposal option.

He said on February 9, 2023, the Board of Survey team visited the Barge site and provided a status update in a report dated March 28, 2023.

Mr Aidoo said through interaction with the local community, it was believed that Misak Ltd carried out the dismantling of the barge

He said consequently, the Ministry of Energy would prevail on GNPC to continue with the steps as outlined in the Public Procurement Authority guidelines for the disposal of goods to establish the value of the scrap material.

He noted that in addition, the Ministry would engage Misak Ltd to formalize an agreement to share the revenue from the scrap material amongst GNPC, the Project Community and Misak