Ghana Water Limited (GWL) has been ordered to pay about US$235 million to the Spanish-owned company behind the Teshie desalination plant following the termination of a water purchase agreement for the facility.
The International Chamber of Commerce (ICC) arbitration court issued two final awards on September 17, 2026, in a dispute between Ghana Water and Befesa Desalination Developments Ghana Limited, the company operating the desalination project.
Spanish group Cox, which owns 95 percent of the Ghanaian project company through its subsidiary Befesa Desalination Developments Ghana, announced the awards, saying the amount covers payments arising from the termination of the water purchase agreement, together with interest from April 1, 2026, until settlement.
The Republic of Ghana has also been found liable under a state guarantee issued for the project, meaning the government could ultimately be required to meet the financial obligations if Ghana Water fails to do so.
However, the awards prevent the project company from recovering the same amounts twice.
The arbitration tribunal also substantially rejected counterclaims brought by Ghana Water, including a US$144.5 million claim, while ordering the utility to reimburse part of the legal costs incurred by the project company.
The ruling comes at a time when the Teshie-Nungua desalination plant has remained out of operation since October 2025, after Ghana Water shut down the facility amid unresolved contractual issues and concerns over maintenance.
The shutdown has affected water supply to communities including Teshie, Nungua, Spintex, parts of Sakumono and La, increasing reliance on tanker services, boreholes and other emergency water supply arrangements.
The financial dispute dates back several years and centres largely on the cost of water produced by the plant compared with the tariff Ghana Water was permitted to charge consumers.
Reports have indicated that Ghana Water was purchasing desalinated water at about GH¢6.75 per unit while the approved tariff allowed the utility to sell it at GH¢1.47, creating a substantial gap between the cost of production and the revenue recovered from consumers.
The utility previously halted payments and sought to renegotiate the agreement, citing the financial burden associated with operating the facility.
The US$126 million desalination plant was commissioned in 2015 under a 25-year build-own-operate-transfer arrangement.
It was designed to produce up to 60,000 cubic metres of treated water daily, enough to serve as many as 500,000 people within the Teshie-Nungua catchment.
The project received significant international backing, with the World Bank’s Multilateral Investment Guarantee Agency providing US$179.2 million in guarantees in 2012.
The original project involved Abengoa Water Investments Ghana, Daye Water Investment and local partner Hydrocol. Cox acquired the assets of Spanish engineering group Abengoa in 2023 and subsequently became the majority owner of the Ghanaian project company.
The latest arbitration ruling comes after government renewed efforts to resolve the dispute and restore the plant to production.
In February 2026, President John Mahama directed the Finance Minister, the Attorney-General and Ghana Water to engage the plant’s shareholders to find a settlement that could enable the facility to resume operations.
Ghana Water Managing Director Adam Mutawakilu said at the time that discussions had already begun, with further negotiations planned.
Cox, however, cautioned that the US$235 million awarded represents gross amounts recognised within the project’s financing structure and should not be interpreted as an equivalent amount of immediate cash proceeds for the group.
The company said the ultimate financial impact would depend on the amounts actually recovered, the rights of third parties and the applicable accounting treatment.
The awards are described as final and binding, although they remain subject to applicable legal challenge procedures.
The case adds to Ghana’s growing exposure to international arbitration claims and raises further questions about the financial risks associated with long-term public-private infrastructure contracts.
Ghana Water Limited is referred to in the arbitration awards by its former corporate name, Ghana Water Company Limited.
