The Government of Ghana, under the leadership of President John Dramani Mahama, has decisively resolved the crippling energy sector debt that had posed one of the gravest risks to the nation’s financial stability.
When President Mahama assumed office in January 2025, the energy sector was on the brink of collapse following years of persistent non-payment for gas supplied from the Offshore Cape Three Points (OCTP) field. The situation had led to the complete depletion of the World Bank Partial Risk Guarantee (PRG) of US$500 million, a safeguard established in 2015 to underpin nearly US$8 billion in private sector investment through the Sankofa Gas Project.
The PRG was designed to guarantee payments to project partners ENI and Vitol in the event of shortfalls. Its exhaustion under the previous administration represented a serious governance failure that undermined Ghana’s international credibility.
Debt Fully Cleared
In a demonstration of fiscal discipline, Government announced that as of 31 December 2025, it had fully repaid US$597.15 million, inclusive of interest, drawn on the World Bank Guarantee. This repayment has restored the facility in full and reaffirmed Ghana’s standing as a credible and reliable partner on the global stage.
Between January and December 2025, Government also settled all outstanding gas invoices owed to ENI and Vitol for electricity generation, amounting to approximately US$480 million. Adequate budgetary provisions have been secured to sustain timely payments going forward.
Engagements with Upstream Partners
Constructive engagements with Tullow Oil and Jubilee Field partners have produced a roadmap to guarantee full payment for all gas off-taken. This initiative is expected to support reliable nationwide electricity generation while accelerating industrial growth. Already, increased gas production has been recorded, guided by a national vision to scale up domestic supply and reduce reliance on costly liquid fuels.
Independent Power Producers
As part of a broader energy sector reset, the Mahama Administration renegotiated all Independent Power Producer (IPP) agreements to secure improved value for money. In 2025 alone, Government paid approximately US$393 million in legacy IPP debts, further anchoring stability in the sector.
Breakdown of IPP Payments in 2025:
- Karpowership Ghana Co. Ltd – US$120,000,000
- Cenpower Generation Co. Ltd – US$59,444,180
- Twin City Energy (Amandi) – US$37,986,534
- Early Power Ltd – US$42,000,000
- BXC Company Ltd – US$10,560,000
- Meinergy Technology – US$8,820,000
- Sunon Asogli Ghana Ltd – US$54,000,000
- AKSA Energy Limited – US$30,000,000
- Cenit Energy Ltd – US$30,000,000
Total: US$392,810,714
Altogether, the Ministry of Finance disbursed approximately US$1.47 billion in the 2025 fiscal year to rescue and restore Ghana’s energy sector. Beyond clearing inherited arrears, the disciplined implementation of the Cash Waterfall Mechanism has ensured that Government remained current on nearly all IPP invoices during the year.
A New Era of Stability
The Government of Ghana has assured the public, industry stakeholders, and international partners that the era of uncontrolled energy sector debt accumulation is over. With restored credibility and strengthened financial discipline, the administration says the energy sector is now positioned to drive reliable power supply and industrial growth.
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