Ghana’s energy sector faces imminent disruption as Karpowership, a key power provider, has issued a seven-day ultimatum to the government over outstanding debts.

0

The company has threatened to shut down operations if the arrears remain unpaid—a move that could push the country dangerously close to a nationwide blackout.

1

Minister for Energy and Green Transition, John Abdulai Jinapor, disclosed this looming crisis during an appearance on JoyNews' PM Express.

2

He revealed that Karpowership’s demand is part of a broader financial strain that has gripped the energy sector, with debts inherited from the previous administration now totaling a staggering $1.7 billion.

3

“Yesterday, I received a letter from Karpowership, and they have threatened to shut down the plant in seven days due to the unpaid bills we inherited,” Mr Jinapor said.

4

The minister outlined the breakdown of debts owed to major energy providers: $297 million to Asogli Power, $220 million to SNIT, $423 million to SEND Power, and $371 million to Karpowership.

5

“As you can see, the debt portfolios include $297 million owed to Asogli, $220 million to SNIT, $423 million to SEND Power, and $371 million to Karpowership. When you add them all together, the total debt inherited amounts to $1.7 billion,” he noted.

6

Efforts to renegotiate payment timelines have so far proven unsuccessful.

7

“We have been exploring every possible avenue to negotiate with them for some breathing room, but they have made it clear that they will not budge,” he added.

8

Mr. Jinapor also pointed to the growing pressure on the energy sector’s financial sustainability, citing a total sector debt of over GH₵80 billion.

9

He mentioned the impact of a $170 million Litasco guarantee which has already been exhausted. As a result, oil that could have been sold to support the economy is being redirected to settle debts.

10

“The Litasco guarantee, which was about $170 million, has also been drawn down. As a result, the oil that would have been sold to generate revenue for the economy had to be taken in order to repay the debt. When asked if it was an agreement that, in the event of non-repayment, they would take the oil, he said, ‘Yes, they take the oil, lift it, sell it, and then use the proceeds to repay the debt.’”

11

“The oil that would have been sold to support the economy had to be taken in order to repay the debts,” Mr Jinapor confirmed.

12

Amid these challenges, the minister stressed the need for swift investment in energy infrastructure—particularly a new gas processing plant estimated to cost $700 million.

13

“We need this gas processing plant like yesterday,” he said. “We will fund it with domestic resources, and every discerning Ghanaian should support this initiative.”

14

He also expressed optimism about clearing the current infrastructure backlog within the next two years.

15

“Our timeline is just two years. We’ve completed the committee work, and within that time, we should be able to clear the infrastructure backlog,” he stated, though he acknowledged that technical processes such as pre-commissioning could extend beyond that timeframe.

16

Despite the mounting pressure, Mr Jinapor remained cautiously optimistic, noting the government’s growing clarity on the scale of the crisis.

17

“We’ve completed the first quarter of the year, and we now have a full understanding of the challenges we face,” he said.

18

“To settle these debts, we have to use our oil. It’s a service that someone paid for, and to pay it off, we have no choice but to use what we have,” he concluded.

19

20