The Africa Center for Energy Policy (ACEP) has said plans by the National Democratic Congress (NDC) to cancel the controversial Agyapa Royalties deal if it wins power raises the risk of the deal.

Opposition NDC flagbearer, John Dramani Mahama, said recently that his government will cancel the deal because it fails the test of transparency.

However, Executive Director of ACEP, Benjamin Boakye, said comments such as those by the NDC flagbearer have the potential of raising the risk premium of the deal.

“What we are trying to do is to ensure that we can mitigate risks…so our questions can be answered while recognising that some statements could make investors quite sensitive.

“And that will affect how much you can raise and what risk premium you’d have to pay for on what you are raising on the stock market,” he said.

The Agyapa deal

Agyapa Minerals Royalties Limited deal was passed recently in Parliament despite a walk out by the Minority MPs.

Under the deal, the firm will trade shares on the Ghana Stock Exchange and the London Stock Exchange for private people to buy.



Two years ago, Ghana’s Parliament passed the Minerals Income Investment Fund Act 2018.

The act establishes the Minerals Income Investment Fund to manage the equity interests of Ghana in mining companies, and receive royalties on behalf of government.

The fund is supposed to manage and invest these royalties and revenue from equities for higher returns for Ghana.

The law allows the fund to establish Special Purpose Vehicles (SPVs) to use for the appropriate investments. Last month, government introduced an amendment to the act to ensure that the SPVs have unfettered independence.

In pursuit of the provisions in the original act and the amendment, the Minerals Income Investment Fund has set up an offshore limited liability company known as Agyapa Royalties Limited (which was previously known as Asaase Royalties Limited).

The firm has been incorporated in Bailieick of Jersey – UK, a tax haven.

Agyapa Royalties Limited has been registered in Ghana as an external company. Now, it has established a Ghanaian subsidiary known as ARG Royalties Ghana Limited, which is currently the sole shareholder of Agyapa.

CSOs oppose

An alliance of civil society organisations (CSOs) working on extractive, anti-corruption and good governance sectors have asked the government to suspend the deal until all documents relating to its establishment and its owners have been disclosed.

According to the CSOs, 15 of them, a consultative process that reflects the views of the people in such an important decision should have been considered before it was passed.

The CSOs include the Africa Centre for Energy Policy (ACEP), the Centre for Extractives and Development Africa (CEDA), the Integrated Social Development Centre (ISODEC), CSOs Open Licensing Monitoring Group, the Citizen's Movement Against Corruption (CMAC), the Civil Society Platform on Oil and Gas (CSPOG), Penplusbyte and Oil Watch Ghana.

The rest are the Institute of Democratic Governance (IDEG), the Centre for Democratic Development (CDD), the Natural Resources Governance Institute (NRGI), Publish What You Pay (PWYP), the Centre for Public Interest Law (CEPIL), IMANI Ghana and Women Aspire.