One of Ghana’s iconic commercial buildings in the United Kingdom, Regina House, has been released to the state after it was seized by Trafigura for the country’s default on a $134 million judgment debt.
Trafigura’s Ghana Power Generation Company (GPGC) was awarded $134 million four years ago after Ghana abrogated a power purchase agreement.
Attorney General Godfred Yeboah Dame confirmed the release in an interview with Citi News.
He stressed that the Ministry of Finance and the Ministry of Energy will negotiate the terms of payment with Trafigura which his office will review to ensure it is in the best interest of the country.
“[The release] that occurred and I am also happy to state that that property has been released from attachment. We dealt with it some time ago.
“Secondly, I must also stress again that the duty to settle or negotiate the specific terms of settlement with GCPG is between the Ministry of Finance and the Ministry of Energy and not the Attorney General. My obligation is to review the terms that will be agreed upon by the two institutions and ascertain that they are in the best interest of the country.”
The judgment, originally handed down by English courts, stems from a complex and highly consequential legal battle rooted in a power purchase agreement between Trafigura’s subsidiary, the Ghana Power Generation Company (GPGC), and the government of Ghana.
The origins of this legal dispute trace back to a decision made on January 26, 2021, by a UK tribunal. The tribunal issued a decisive final award, concluding that the Ghanaian government had breached its contractual obligations under the power purchase agreement with GPGC.
This breach occurred when Ghana unilaterally terminated the agreement on February 18, 2018. The tribunal’s findings were damning, ruling that Ghana was liable to pay GPGC a staggering $134,348,661 as an early termination payment.
This significant judgment not only involved the early termination payment but also included an additional financial burden on Ghana. The tribunal ordered that the Ghanaian government reimburse GPGC’s arbitration fees and expenses, which totalled $3,309,877.74. The interest on this sum was set at a three-month USD LIBOR rate, compounded quarterly, adding another layer of financial strain on the country.
Despite the clear and binding nature of the tribunal’s ruling, Ghana’s response was inadequate. Rather than settling the debt in full, the Ghanaian government made only partial payments, totalling $1,897,692.40. This left a considerable balance of $111,493,828.92 in arrears, with interest continuing to accumulate on the unpaid amount.
The situation took a more complex turn when Ghana sought to challenge the UK judgment, but only after failing to do so within the appropriate legal timelines in the UK courts.
Ghana’s High Commission to the United Kingdom, Papa Owusu-Ankomah in an interview with Accra-based Joy FM indicated that revenue from the property will be going to Trafigura till the debt is paid in full.
“Until we pay in full or come into an arrangement to pay them,” Papa Owusu-Ankomah told Joy News, Trafigura will remain in control over the receivership of the Regina House and its proceeds, admitting also that “(Ghana) is now facing financial challenges.”
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