The Government of Ghana, under the leadership of President John Dramani Mahama, has cleared a major backlog of energy sector debt, resolving one of the most serious risks to the country’s financial stability and restoring a key World Bank guarantee within its first year in office.
When President Mahama assumed office in January 2025, the energy sector was under severe strain following years of non-payment for gas supplied from the Offshore Cape Three Points (OCTP) field to the power sector. As a result, the World Bank Partial Risk Guarantee (PRG) of US$500 million had been fully exhausted under the previous administration.
The PRG, established in 2015 under the previous NDC government, was a critical safeguard that helped unlock nearly US$8 billion in private sector investment into Ghana’s energy sector through the Sankofa Gas Project. It was designed to guarantee payments to project partners, ENI and Vitol, in the event of payment shortfalls. Its depletion had significantly undermined Ghana’s international credibility.
As of December 31, 2025, government has fully repaid US$597.15 million, including 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 in the international financial community.
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. This has ensured that Ghana is fully current on its obligations to the Sankofa partners. Adequate budgetary provisions have since been secured to sustain timely payments going forward.
In addition, government has engaged constructively with Tullow Oil and the Jubilee Field partners and agreed on a comprehensive roadmap to guarantee full payment for all gas off-taken. The engagement is aimed at supporting reliable nationwide electricity generation while accelerating industrial growth. Discussions with upstream partners have already resulted in increased gas production, guided by a clear national strategy to scale up domestic gas supply and reduce reliance on expensive liquid fuels.
As part of a broader energy sector reset, the Mahama Administration has renegotiated all Independent Power Producer (IPP) agreements to secure improved value for money for the Ghanaian people. In 2025 alone, government paid approximately US$393 million in legacy IPP debts, further consolidating 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 IPP Payments: US$392,810,714
Altogether, the Ministry of Finance disbursed approximately US$1.47 billion in the 2025 fiscal year to stabilise and restore the energy sector.
Beyond clearing inherited arrears, government says it has remained largely current on IPP invoices for 2025 through disciplined implementation of the Cash Waterfall Mechanism by the Ministry of Energy, with further improvements in payment performance expected.
The Government of Ghana has assured the public, industry stakeholders and international partners that the era of uncontrolled energy sector debt accumulation is over.