Ghana has announced a significant US$1.47 billion settlement of longstanding energy sector debts, marking a major step toward stabilising the country’s power sector and restoring international confidence.
According to a statement issued by the Ministry of Finance, the Mahama administration inherited an energy sector “on the brink of collapse” due to years of unpaid obligations for gas supplies from the Offshore Cape Three Points (OCTP) field. The accumulated debts had completely depleted the US$500 million World Bank Partial Risk Guarantee (PRG), a facility crucial for mobilising nearly US$8 billion in private investment under the Sankofa Gas Project.
As of 31 December 2025, the government has fully repaid US$597.15 million (inclusive of interest) drawn on the World Bank guarantee, effectively restoring the facility in full and reinforcing Ghana’s credibility with its international partners.
In addition, the Ministry said the government settled all outstanding gas invoices owed to global energy partners ENI and Vitol, amounting to approximately US$480 million, ensuring Ghana is up to date on its obligations for electricity generation.
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The administration also engaged upstream stakeholders, including Tullow Oil and Jubilee Field partners, to establish a comprehensive payment roadmap aimed at sustaining a reliable gas supply and enhanced electricity output.
As part of broader reforms to strengthen the sector, the government renegotiated all Independent Power Producer (IPP) agreements and paid about US$393 million in legacy IPP debts in 2025. Key beneficiaries included Karpowership Ghana, Sunon Asogli Power, Cenpower Generation and other power producers, which has contributed to stabilising power generation nationwide.
The Ministry of Finance stated that the disciplined fiscal strategy and enhanced payment mechanisms, including the Cash Waterfall Mechanism, have helped ensure timely payments and bolstered investor confidence. Government officials emphasised that this decisive action lays a firmer foundation for long-term sector stability, increased domestic gas utilisation, reduction of reliance on expensive liquid fuels, and sustained economic growth.
