KT Hammond and Tsatsu Tsikata

It has emerged that Justice Yaw Apau, who is investigating the payment of judgment debts, particularly the sale of Ghana National Petroleum Corporation (GNPC) drillship to settle some of the corporation?s indebtedness, sat on a case when the state oil company was sued.

Justice Apau was the judge who ruled for CDH Holding and slapped GNPC with huge judgment running into several billions of old cedis. Speaking to DAILY GUIDE, former Deputy Minister for Energy, K.T. Hammond said GNPC could not have been in a state of financial solvency and still be saddled with litigations over unpaid loans and financial arrangements.

Mr Hammond  challenged the ex-GNPC Chief Executive, Tsatsu Tsikata to give a full account of the financial position of the state-run oil company at the time he exited office in late 2000 for the public to assess the situation.

K.T. Hammond indicated that Tsatsu run the GNPC in an uncontrolled manner that it became bankrupt and could not pay its debts.

He said because GNPC could not settle its debts, the company was dragged to court by institutions like CDH Holdings and Soci?t? G?n?rale, which the Kufuor administration had to sell drillship Discoverer 511 in 2001 for $24million to pay judgment debts against the state-owned oil company.

The Kufuor administration had been accused of legal and procedural breaches by the Judgement Debt Commission for not consulting the Board of the GNPC which had the legal mandate to sell the ship.

Incidentally, Justice Yaw Apau who is now investigating into the drillship sale was the same judge who ruled for CDH Holding and slapped GNPC with huge judgment running into billions of cedis.

The sale of the GNPC?s drillship had been an object of controversy and a subject of inquiry by the Sole Commissioner appointed by President John Mahama to investigate all judgement debt cases in the country from 1992 to date.

The ship was sold for $24 million out of which $19.5 million was used to defray a debt owed Soci?t? G?n?rale, $1million for GNPC?s legal fees and other debt payments with the remaining $3.5million deposited in a government?s account at the Ghana International Bank in UK, London and disbursed by the Controller  and Accountant-General?s Department.

Mr K.T. Hammond dared Tsatsu to tell Ghanaians if he got the approval of GNPC board before embarking on all the numerous non-profitable ventures including a failed hedging contract with Soci?t? G?n?rale.

According to him, Mr Tsatsu boasted before the Sole Commissioner Justice Yaw Apau who is investigating into the judgment debts and compensations payments to institutions and individuals that GNPC was in sound financial condition with huge assets by the time he left office without mentioning the corporation?s uncontrollable debt portfolio.

?If GNPC was doing so well as Mr Tsikata claimed, why was he (Tsikata) sacked in late 2000 by President Rawlings who had one-time described him as a Wizkid?? Mr Hammond quizzed.

The former deputy minister pointed out that Tsatsu had ?single-handedly? mismanaged GNPC and created huge financial mess to the level of depleting the country?s scarce finances that the Minister for Finance at the time and a well-celebrated economist, Dr Kwesi Botchwey had to resign in 1995 in protest.

GNPC?s Indebted to CDH

justice apau

Following Justice Apau?s ruling, the Kufuor administration had to fall on the Drillship account where the balance of $3.5million was deposited, to pay GNPC?s indebtedness to CDH.

Available documents indicated that the Kufuor administration had indeed settled the debt as Albert Kan-Dapaah, former Minister for Energy in a letter of December 22, 2003 requested the Minister for Finance to pay the GNPC?S indebtedness to CDH from the drillship account.

The former Energy Minister had indicated that the ?GNPC?s indebtedness to CDH of about ?30billion was recently settled in negotiation at ?14.3billion.?

?The decision has necessitated the mobilization of funds to meet the stipulated payment deadlines, (well, they have been overrun). The first ?4billion has been paid out of GNPC?s available funds leaving an unpaid balance of ?10.3billion.

?I should be grateful if you could transfer the remaining balance of about $450,000 from the D511 Drillship Account Number 0001191613 with Ghana International Bank Plc, London for partial settlement of the outstanding balance.

?Additionally, I also appeal to you to consider settling the further balance of ?6.3billion from Government coffers since GNPC cannot possibly meet this obligation. It simply has no funds of its own,? the letter concluded.

Dr Akoto Osei?s Reply

Responding to the letter, a deputy Minister for Finance, Dr Anthony Akoto Osei stated in a correspondence dated January 16, 2004 said ?I have just been informed that the balance in the D511 Drillship Account Number 0001191613 with Ghana International Bank is $601,726.00

?Subsequently, I am glad to inform you that approval has been given for an amount of $550,000 to be transferred from this account to the CDH account quoted below at the interbank rate of ?8,881.55. This translates to ?4,884,852,500.00. This will leave a balance of approximately ?5.41 billion of GNPC?s indebtedness to CDH.

Controller and Accountant-General?s Response

Based on the January 16, 2004 letter from Dr Akoto, E. A. Ofosuhene, acting on behalf of the Controller & Accountant-General directed the Treasury Officer at Ghana High Commission in UK to release money to CDH.

?You are hereby authorised to transfer the sum of US$550,000.00 (five hundred and fifty thousand US Dollars) from the Treasury Officer Special Dollar Investment Account No.: 0001191613 at the Ghana International Bank PLC, 69 Cheapside, London to Account No. 01725102, Sorting Code: 700613 at Ghana International Bank PLC, London, UK for the credit of CDH.

?The transfer is to enable the GNPC pay part of their outstanding indebtedness to CDH,? Mr Ofosuhene indicated.

GNPC Investments

Tsatsu told the Judgment Debt Commission that under his watch, GNPC had made several investments that had yielded dividends for the country.

However, K.T. Hammond disagreed, arguing that with the exception of Westel, a telecom company which in the end was sold for about $120 million, almost all the investments rather depleted the country?s finances.

?In any event, January 2001 when we took over Westel, there was a little less than $5million. If Westel was sold at that time it would not even have been enough to pay the huge debts of GNPC or GNPC?s equity share in Westel which the Corporation had not paid,? Mr Hammond pointed out.

According to him, GNPC had only 33 percent shareholding in Westel when the NPP assumed office, adding that the company was not even functioning properly at the time.

?With the exception of that, what is the so-called investment that Mr Tsatsu Tsikata is talking about?? KT Hammond questioned.

According to him, Tsatsu abandoned the core mandate of GNPC to find and had engaged in all sorts of non-profitable ventures like the Mole Game Reserve, Songhor Salt Project and Valley Farms.

Drillship Pledged

K.T. Hammond said Tsatsu who chastised them for not knowing the intricacies of the drillship, pledged the ship to two financial institutions, Credit Suisse Boston International and Soci?t? G?n?rale.

?Tsatsu who knew everything about the ship had pledged to sacrifice the interest of GNPC and pledge the so-called famous ship or the so-called GNPC?s priceless asset to both Soci?t? G?n?rale and Credit Suisse.

?This is the man who is accusing everybody of not knowing anything about the drillship.?

Tsatsu had vehemently denied allegations that the drill ship was used as collateral to secure a funding transaction with Soci?t? G?n?rale and further questioned the valuation of the ship for the $24 million.


K.T. Hammond indicated the most worrying aspect was that Tsatsu failed to tell the sole commissioner that ?he had bought and rehabilitated about seven ships/rigs? to the tune of about $82 million.?

?Of the $82million that I talked about how much was the investment returns and the $15million that he earned on the Discoverer 511, where was the money put?? The former deputy minister quizzed.

The ships which were acquired around 1992, according to him, included the ?North Sea Pioneer, The Chaparral, The Asterie, Mr Louise and the famous drillship Discoverer 511.?

?Let Mr Tsikata tell the whole world that how many of these ships or marine assets worked for one hour except of course the Discoverer 551.

?How were the so-called assets located?? K.T. Hammond quizzed, pointing out that except for Mr Louise, which could simply not move anywhere and packed somewhere in Sekondi or Takoradi, all the other ships were based in foreign countries, not doing any work for GNPC.?

According to him, what even made matters worse was that there the ships were being serviced with hundreds of thousands of dollars every month as well as workers on the ships being paid for doing nothing.

He, however, commended the Tsatsu-led GNPC for putting together a comprehensive seismic data for oil discovery in the country.

By Awudu Mahama


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