The Government of Ghana has reaffirmed its commitment to settle its outstanding debt to oil trader Trafigura, despite recent threats by the company to seize Ghanaian assets in South Africa due to delayed payments.
In a statement issued by the Ministry of Finance on Tuesday, September 24, the government confirmed it has made necessary arrangements to clear the agreed claims after multiple rounds of negotiations with Trafigura. The Ministry expressed surprise at the circulation of a letter from Trafigura on social media, which it said falsely suggested inaction by the government on the matter.
The Ministry acknowledged that discussions with Trafigura are ongoing and assured the public that efforts are being made to honor the obligations under the Settlement Agreement. Trafigura had earlier, on September 23, expressed frustration over the government’s delay in resolving the debt. The company indicated that it had filed papers to enforce the arbitral award in South Africa and could take further legal action against US-based corporations linked to the Government of Ghana if the issue remains unresolved.
The dispute dates back to a 2021 UK court ruling, which ordered the Government of Ghana to pay $140 million in damages to the Ghana Power Generation Company (GPGC) for terminating a power deal. To date, Ghana has made partial payments totaling $1.9 million, leaving a substantial outstanding balance. GPGC, frustrated by the lack of full payment, filed a case in the U.S. District Court in January 2024 to recover the remaining debt.
In this U.S. case, the District of Columbia Court ruled in favor of GPGC, granting a judgment debt of $111.5 million against Ghana, including post-judgment interest. The court found that it had jurisdiction under the New York Convention and that Ghana had waived its sovereign immunity by agreeing to international arbitration as part of the original power purchase agreement. Chief Judge James E. Boasberg emphasized the enforceability of the arbitral award, citing the commercial nature of the relationship between the parties.
Despite these rulings, Ghana has struggled to meet its financial obligations. Deputy Attorney-General Alfred Tuah Yeboah confirmed that while part payments were made, the government failed to follow the agreed installment plan. This resulted in the attachment of Ghanaian properties in the UK. Efforts to dismiss the enforcement process were rejected by the UK High Court, which ruled that proper service was made to the Ghanaian state.
The Ministry of Finance has since been advised to engage with the judgment creditors, and it remains focused on resolving the matter. Trafigura, while preferring an amicable resolution, has indicated it may pursue further enforcement actions if Ghana fails to meet the agreed payment schedule.
