THERE WAS a dramatic twist to the Ghana National Petroleum Corporation (GNPC) Drill Ship saga when a deputy Minister of Energy in the Kufuor administration, K.T. Hammond, yesterday dazzled the Judgement Debt Commission with a 65-page document detailing how a supposedly missing $3.5million from the sale of the GNPC oil rig was disbursed.
Mr Hammond, who is also the MP for Adansi Asokwa in the Ashanti Region, in an emotional fashion, revealed that he presented the cheque for the $3.5million after the sale to the then acting Ghana High Commissioner to UK, Chris Kpodo, who later became a deputy Foreign Minister under the Mills-Mahama administration.
He also produced a document indicating that $19.5million was paid to Societe Generale directly by the buyers of the drillship.
GNPC?s drillship Discoverer 511 was sold in July 2001 by the Kufuor administration for $24million to defray multiple debts of the state-owned oil corporation including $19.5million to Societe Generale, $1million for the company?s legal and other expenses; and a balance of $3.5million paid into government?s account in Ghana International Bank PLC (GIB) in London, UK which disbursement was said to be shrouded in mystery.
Albert Kan Dapaah
The saga of the supposedly missing $3.5million had highly been politicised in the media and during the 2014 budget presentation in Parliament where members of the Majority National Democratic Congress (NDC) displayed fliers indicating the Kufuor administration had corrupted the drillship deal.
However, Justice Yaw Apau, the sole commissioner investigating the judgement debts and compensations payments to individuals and institutions, journalists and observers in the highly packed chamber of the old Parliament House appeared spellbound when an emotionally charged K.T. Hammond produced the 65-page document, which he indicated contained the opening of the drillship account, the name of the account into which the $3.5million was deposited and various withdrawals from the account by the Controller & Accountant-General.
Shocking Revelations
The document, he indicated, contained ?shocking? revelations about individuals who authorised the withdrawal of monies from the $3.5million from GIB account in London.
The former Deputy Energy Minister virtually broke down in tears before presenting the document to the Sole Commissioner.
Sealed in a brown envelope, Justice Apau gave back the document to Hammond to open it himself, exclaiming in a rather humorous manner that the document may well contain explosives.
The former deputy minister opened the document and tendered it as evidence on how the $3.5million was disbursed.
He bemoaned the wanton vilification and wrongful accusation of corruption against his person, his Minister, Albert Kan-Dapaah, as well as the Kufuor administration over the sale of the drillship. What made matters worse was that even state institutions which should have all the records claimed they did not have documents relating to the transaction.
Mr Hammond said God being so good, an unknown person who thought ?enough was enough? dropped the voluminous document, which he believed was God-send to vindicate him, in his pigeon-hole in Parliament to help settle the matter conclusively.
Agony Mother
Mr. Hammond told the Commission his mother in the village was dying because he had been wrongly accused in the media of embezzling the $3.5million dollars when all he had done was to offer diligent and selfless service to his country and the GNPC.
?We were prudent and quite clear in everything we did,? he told the Commission.
Earlier, the former deputy Energy minister presented 26 documents to the Judgement Debt Commission, indicating among others, the failed state of the GNPC and the huge indebtedness of the corporation at the time the Kufuor administration took office in January 2001.
He told the sole commissioner that GNPC was in a state of complete mess with huge indebtedness and could not even pay its staff when the Kufuor administration took over the running of the state.
Responding to queries by Justice Apau that the Kufuor administration sold the drillship without recourse to the corporation?s board, K.T. Hammond emphasized that government had to take the decision because ?GNPC by all accounts, had failed as a corporate entity.?
Quoting legal authorities, including the Principles of Modern Company Law, the former deputy minister indicated that when there was no board of directors in the company, the shareholders took over the functions of the board.
GNPC, he maintained, could not advise itself and that was why it was in a financial mess and that it was the duty of government, which is the sole shareholder, to restructure the corporation in a manner that was best for the country. He said the restructuring had today yielded oil in commercial quantity.
Documents
The documents which K.T. Hammond presented chronicling the events leading to the sale of the drillship, admitted that the corporation owed Societe Generale to the tune of over $40million.
This, according to him, confirmed that even though the Kufuor administration had planned to sell the drillship, GNPC had already given indication it was ready to sell the drillship to pay off its debts.
He produced letters signed by Mr. Tsikata signalling GNPC?s intent to sell the ship.
It was pointed out that on December 15, 1998, Mr. Tsikata confirmed to the GNPC board that the corporation was indebted to Societe Generale to the tune of over $40million and it was this amount that accrued interest, increasing the total indebtedness to $47million.
Furthermore, on March 16, 1998, Credit Suisse indicated in a correspondence that GNPC was indebted to it to the tune of about $18.47million.
With all these mounting debts coupled with the fact that Societe Generale had obtained judgement in London court against GNPC claiming the $47million, Mr. Hammond said the Kufuor administration had to take drastic measures to settle the matter and salvage the corporation from total collapse.
Drillship Sale
The sale of the GNPC?s drillship had been an object of controversy and a subject of enquiry by the Sole Commissioner appointed by President John Mahama to investigate all judgement debt cases in the country.
The Kufuor administration had been accused of legal and procedural breaches by not consulting the Board of the GNPC which had the legal mandate to sell.
Some also accused K.T. Hammond and his boss Albert Kan Dapaah of misappropriating the remaining $3.5 million which was left from the $24 million realised from the sale of the ship.
However, K.T. Hammond, who handled the drillship transaction, maintained there was no wrongdoing in the whole transaction.
Facts Of The Case
Earlier, Mr. Hammond?s former boss at the Ministry of Energy, Albert Kan-Dapaah, had informed the Judgment Debt Commission about the circumstances surrounding the sale of the oil drillship.
He told the Sole Commissioner that the GNPC under the leadership of Tsatsu Tsikata decided to fund all its oil exploration activities so that in the event Ghana struck oil, all the proceeds would remain in Ghana.
As a result of that policy, he said GNPC undertook commercial activities and financial engineering programmes to raise funds for the expensive exploration activities.
One of the arrangements, Mr. Kan-Dapaah indicated, was a hedging facility with multinational French Bank Societe Generale which began from 1987 to around 1998.
According to him, the hedging agreement was entered into with the projection that by 1998 oil would be struck in the Tano Basin.
Unfortunately, there was no success in oil exploration by the projected year of 1998 and the GNPC was then saddled with debt.
The former Energy Minister told the Commission that a debt of $40million was incurred as a result of the transaction with Societe Generale with an accruing interest, totalling $47million.
Consequently, the French bank sought a UK court judgement asking GNPC and the government of Ghana to pay the debt.
Kufuor Administration?s Policy
Mr. Kan-Dapaah told the Commission that the Kufuor administration, which inherited the mess at the GNPC, decided to negotiate a settlement with Societe Generale and not to litigate the matter since the former CEO of the Corporation, Mr. Tsikata, had already admitted the indebtedness. Mr. Tsikata will appear before the Commission today for his take on the issue.
The government also took a policy decision that the cost of oil exploration should be borne by the private investors and not by GNPC or government.
Mr. Kan-Dapaah said it was based on this policy that the Kufuor administration took a decision that the marine assets of GNPC, which were being maintained at a great cost without any returns, should be sold.
He said it was at this point that his deputy, K. T. Hammond, was delegated by Cabinet to act on behalf of the government of Ghana and negotiate a deal with Societe Generale.
The former Energy Minister told the Commission that through the hard work and diligence of Mr Hammond the $47million debt owed Societe Generale was drastically reduced to $19.5 million.
He reiterated that the GNPC had already mortgaged the drillship as collateral for a loan based on which Societe Generale procured an order from an Omani court to have the ship sold.
According to him, Societe Generale effectively did not need the permission of the Government of Ghana to sell the ship.
By Awudu Mahama
