.. and Puts Mineral Resources On "Awawa"
At his "Meet the Press" the Hon Minister for Harbours & Railways did inform Ghanaians that he had received Cabinet Approval to sign a BOT Agreement with Kampac Oil Ltd. for the Western Railways Line and has signed another with Peatrak for the Eastern Line. Simply put BOT is the acronym for Build Operate and Transfer. A consortium headed by Dubai-based Kampac Oil Company has signed a $1.6 billion contract for the railway project in western Ghana.

Kampac has announced the signing of a 35-year concession with the Ghana Railway Corporation.

The contract involves the construction of 800 km of new railway line and rehabilitation of 400km of existing line.

Kampac has secured the mineral and mining rights for proven reserves valued at more than $2 billion as part of the concession.

The financing of the project was done through the assignment of $2 billion worth of mineral and mining rights to the consortium on an exclusive basis. Kampac plans to raise $2 billion to $4 billion by monetising a portion of the mineral property assets.

At the recent Parliamentary Vetting of the Minister of State for Finance, he informed the general public, in response to questions from the Committee, that he was unaware of pending Railway Agreement at the Ministry of Railways.

During that same vetting the Hon. Hackman Owusu Agyeman, a member of the Committee, intervened and lectured the Committee and the public on BOT and the fact that the Ministry of Finance did not necessarily have to be involved in BOT negotiations by a Sector Ministry.

The Agreement, as signed by the Railways Ministry, cannot be a BOT by any stretch of imagination! Rehabilitation of an existing railway line does not qualify as a BOT. Are we to believe the Honourable Minister of Harbours and Railways that he has our Cabinet approval for the following:

Hand over to a private "Investor", for no consideration or value (free), all the existing assets of Ghana Railway Company from Takoradi to Kumasi;

Give minerals and mining rights for key proven reserves valued at more than the project costs (US $2 billion) to the "Investor";

Exclusively assign and authorize the "Investor" to use these state assets as collateral in order to enable the "Investor" raise money to Build, Operate and Transfer the same assets to Ghana after 35 long years;

Cause Bank of Ghana and Ministry of Finance to allocate, on regular basis for 35 years, Foreign Exchange and transfer US$1.6 billion to the benefits of Kampac Oil and claim the BOT Agreement has no recourse to Government of Ghana. Point 6 of the highlights of the Agreement above indicates that "Kampac plans to raise $2 billion to $4 billion by MONETISING (our caps) a portion of the Mineral property assets".

For the avoidance of doubt, "monetising" involves pawning or pledging to a Lender (Bank or Financier) in our local parlance "awawa". In the Ghana Constitution, it is the exclusive prerogative of the Ministry of Finance and/or Bank of Ghana, with the approval of Parliament, to raise money for the development of the country.

• Comment 1: "What did Cabinet approve for the Hon. Minister of Railways to do with the difference between the actual project cost of US$1.6 billion and the US$2 to 4 billion being raised against our national mineral resources?

• Comment 2: If Kampac Oil could not deliver on a simple oil storage tank project valued $70 million only (awarded to the company by the Ministry of Energy and actually within his core business), are we to believe that he will deliver on a $1.6 billion BOT project?

  A cursory visit to the Google website (www.google.com) on the Internet and typing "Kampac Oil" in the search textbox would have revealed to the Railways Ministry that Ghana is not the first, and may not be the last of African Countries, who have assigned national resources to Kampac Oil for which funds were supposed to be raised for the agreed projects in London and New York to no avail.

• Comment 3: Who did the due diligence for the Ministry of Railways on Kampac Oil’s ability to Build and Operate a railway?

• Comment 4: The Ministry of Railways recently signed a contract with Peatrak Ltd. a locally registered company valued at US$5 billion for the Eastern Railways Line. Where has the Ministry reached with the Eastern Line?

• Comment 5: The Railways Ministry has been constructing a 20 km rail line (Accra-Tema) for the last four years. When will the line be ready for Ghanaians to use?

• Comment 6: On whose mandate and interest is the Ministry of Railways playing high stakes "Chacha" with our Railways assets and national mineral resources?

• Comment 7: Why are Ghanaians not asking more questions about the Ministry of Railways and its US$7 billion BOT contracts which the Hon. Minister claims does not have recourse to Government of Ghana and Min of Finance? The Railway Ministry has single handedly contracted projects worth almost twice Ghana’s national debt without recourse to Ministry of Finance and Parliament!