The payments include repaying the depleted $500 million World Bank Guarantee for natural gas supplies, with interest, which has ensured the reinstatement of the vital World Bank risk guarantee against shortfalls in payment for natural gas supplies from the Sankofa Field.

The payments — all made between January and February last year — total $480 million and cover all outstanding gas invoices owed to ENI and Vitol for electricity generation.

This makes the country very current on its obligations to Sankofa partners regarding natural gas supply for power generation.

The John Dramani Mahama-led government also cleared all inherited debts owed to Independent Power Producers (IPPs), amounting to $393 million, further anchoring the gains made in restoring stability to the power sector.

The government also fully repaid $597.15 million, including interest, of the drawn-down World Bank Guarantee.

“Altogether, the Ministry of Finance has paid approximately $1.470 billion in the 2025 fiscal year to rescue and restore Ghana’s energy sector,” a source at the Ministry of Finance told the Daily Graphic.

Beyond clearing inherited arrears, the ministry said, the government remained current on most IPP invoices for 2025 through a disciplined implementation of the Cash Waterfall Mechanism by the Ministry of Energy and Green Transition.

“The government is firmly committed to further improving payment performance across all IPP obligations going forward,” the source stressed. 

Background

The payments to the value chain actors across the three sub-sectors of the energy sector have decisively resolved the crippling energy-sector debt, which posed one of the gravest risks to the country’s financial stability.

When President Mahama assumed office in January last year, the energy sector had been pushed to the brink of collapse by years of persistent non-payment for gas supplied to the power sector from the Offshore Cape Three Points (OCTP) field.

As a result, the World Bank Partial Risk Guarantee of $500 million was completely depleted under the previous administration.

The Partial Risk Guarantee (PRG), established in 2015 under the previous National Democratic Congress (NDC) government, was a critical “insurance” policy that enabled nearly $8 billion in private-sector investment in Ghana’s energy sector through the Sankofa Gas Project.

It was designed to guarantee payments to the project partners, ENI and Vitol, in the event of payment shortfalls.

Its exhaustion represented a serious governance failure that undermined Ghana’s international credibility.

However, the source said, “in a clear demonstration of fiscal discipline and responsible leadership, the government has, as of December 31, 2025, fully repaid $597.15 million, inclusive of interest, drawn on the World Bank Guarantee”.

“This achievement has restored the facility in full and reaffirmed Ghana’s standing as a credible and reliable partner on the global stage,” it added.

Details

Explaining the payments, the source said the government settled all outstanding invoices to energy-sector players through carefully coordinated policy actions between January and December last year.

“Through prudent financial management, adequate budgetary provisions have been secured to sustain timely payments going forward,” the source added.

The source further disclosed that the government had held constructive engagements with Tullow Oil and the Jubilee Field partners, agreeing on a comprehensive roadmap to ensure full payment for all gas taken off.

The approach, the source said, was aimed at supporting reliable nationwide electricity generation while accelerating industrial growth.

“Engagements with Ghana’s upstream partners have already resulted in increased gas production, guided by a clear national vision to rapidly scale up domestic gas supply to meet the country’s growing energy demand and reduce reliance on expensive liquid fuels,” it said.

IPPs renegotiated

As part of its broader energy-sector reset, the Mahama Administration had successfully renegotiated all Independent Power Producer agreements to secure better value for money for the Ghanaian people, the source revealed.

The Ministry of Finance source subsequently provided a breakdown of payments to the IPPs, all in 2025, totalling around $393 million in legacy debt.

They include the Karpower Ghana Company Ltd, which received the highest payment of $120 million; Cenpower followed with $59.44 million and Sunon Asogli with $54 million.

Others include Early Power Ltd, which received $42 million; Twin City Energy (Amandi), which received $37.98 million; and AKSA Energy Ltd and Cenit Energy Ltd, which received $30 million each.

The rest are BXC Company Ltd, receiving $10.56 million and Meinergy Technology, receiving $8.82 million. 

Assurances

The source said beyond clearing inherited arrears, the government was firmly committed to further improving payment performance across all IPP obligations going forward.

The source further assured the public, industry stakeholders and international partners that “the era of uncontrolled energy sector debt accumulation is over”.