Judgment Debt: Trafigura Petitions Finance Minister; threatens takeover of Ghana Assets in South Africa

The Government of Ghana’s woes continue to deepen as Trafigura Group, a multinational commodities company domiciled in Singapore, has petitioned the Minister of Finance, Dr. Mohammed Amin Adam, with a notice of filings to takeover Ghana’s assets in South Africa if debt owed them remains unsettled. The company has already seized Ghana’s Regina House property in London over the government’s failure to pay a $134 million judgment debt.

The Government of Ghana has been embroiled in a legal dispute with Trafigura after it terminated a Power Purchase Agreement (PPA) with Trafigura’s subsidiary, Ghana Power Generation Company (GPGC), in February 2018. The debt piled on as Trafigura secured a US court judgment that awarded the company additional $111.4 million with interest which remains unpaid.

In the petition dated September 23, 2024 and copied Ghana’s Attorney General Godfred Yeboah Dame, the conglomerate warned to take “further action” after a plan to issue further subpoenas to “US-based corporations with ties to the Government of Ghana” if settlement of the debt owed to the company is not made immediately.

The Ministry of Finance received the petition on the 24th September 2024.

The origins of this legal dispute date back to a ruling on January 26, 2021, by a UK tribunal. The tribunal concluded that the Ghanaian government had breached its contractual obligations under the PPA 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. Despite the ruling, Ghana made only partial payments totaling $1,897,692.40 leaving a substantial balance outstanding.

In January 2024, GPGC filed a case in the U.S. District Court, seeking to recover the remaining debt under the New York Convention. Ghana was served with the petition but failed to respond by the deadline. The court, citing Ghana’s waiver of sovereign immunity and commitment to international arbitration, ruled in favor of GPGC.

Source:ceditalk.com