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The Ghana National Petroleum Corporation (GNPC) was not involved in the sale of the drill ship, Discoverer 511, as part of efforts to defray the cost of judgement debt awarded in favour of Societe Generale, against the corporation by a UK court in 2001.
The Chief Executive Officer of the GNPC, Nana Boakye Asafu-Adjaye, who stated this at the sitting of the Judgement Debt Commission in Accra yesterday, however, could not say who was involved when asked by counsel for the commission, Mr Dometi Kofi Sokpor.
The CEO later presented a letter dated October 20, 2001 from the Ministry of Energy to the GNPC Board Chairman, providing details on the sale of the drill ship.
Background to case
Explaining the background to the case, Mr Asafu-Adjaye said in the early 1990s, GNPC, on the advice of Societe Generale, entered into some derivative transactions to manage oil price risk in anticipation of production of oil from the Tano fields.
According to him, Societe Generale recommended a strategy for the derivative transactions, adding that it also provided GNPC with credit lines, as well as controlled what transactions were acceptable.
“However, in 1999, Societe Generale sued GNPC in a London court to recover debts owed to it by GNPC,” he said.
Mr Asafu-Adjaye said the GNPC contested Societe Generale’s claims on the grounds that the losses were incurred because of bad advice given to the corporation on the transactions.
Asked by Mr Sokpor whether the company had a lawyer in the case, Mr Asafu-Adjaye said it was the former CEO who was handling the case before he took over.
The corporation, he said, engaged the services of a legal firm, Bindman and Partners.
When it was put to him by counsel that the law firm was asked to step aside for the Attorney General to take over, he responded in the affirmative, saying that “somewhere along the line, the Attorney General took over the matter”.
Mr Asafu-Adjaye, who became the CEO of GNPC on June 1, 2009, could, however, not state how the Attorney General handled the matter, when asked by counsel how the matter was handled.
GNPC-Societe Generale agreement
On the written agreement between the corporation and Societe Generale, Mr Asafu-Adjaye said he understood that there was an agreement, and that the AG’s Department asked “us to submit all the documents to it”.
He said all the documents were submitted to the AG Department without being photocopied.
“All the documents were sent there,” he said, and agreed with Mr Sokpor that it was a risky venture not to have photocopied the documents before sending them, since they could have been misplaced.
Mr Asafu-Adjaye said he was not in the organisation when judgement was awarded against the GNPC.
He said when the corporation received a subpoena, it checked through its records, and found a letter dated October 24, 2001 from the Ministry of Energy to GNPC.
The letter, he said, had indicated that an amount had been paid to Societe Generale, and gave the figure as $19.5 million.
He could not tell whether that was the amount ordered by the UK court to be paid to Societe Generale.
“I am not aware because I was not there,” he said, and indicated that the GNPC did not take part in the proceedings.
Sole Commissioner
Asked by the Sole Commissioner, Mr Justice Apau, when the documents related to the GNPC-Societe Generale were submitted to the AG’s Department, Mr Asafu-Adjaye said that was done in early 2001.
“At the time the files were handed over, I was in GNPC, I was then the acting Chief Executive,” he said.
When Mr Apau asked why all the files were handed over to the AG’s Department without the corporation keeping copies, Mr Asafu-Adjaye said the department was supposed to peruse the documents and return them but not long after that, he left the GNPC.
“It was a bad practice, in fact, to send all your files to the AG without keeping copies. The AG’s office is saying that they too have misplaced the files; they are now looking for them and that’s why they could not come today,” Mr Apau said.
According to him, information on the issue was scanty because there were three figures as the judgement debt, $12 million, $20 million and $47 million.
He said nobody could tell whether the $19.5 million was part of the judgement debt or service cost to be paid to Societe Generale.
“So if AG is not able to retrieve the files on this case, then it means that it is the end,” he said.
The commissioner asked the CEO to search whether he could find the documents.
Ministry of Energy Chief Director
The Chief Director of the Ministry of Energy and Petroleum, Mr Thomas Mba Akabzaa, who also appeared before the commission in relation to the matter, said he had not seen the contract agreement between the GNPC and Societe Generale.
Mr Akabzaa, who said he assumed office in February, 2011, indicated that till he received the subpoena, he was not aware that Societe Generale had commenced an action against GNPC.
Representatives of the AG/Solicitor General, who were supposed to appear at the sitting in the same matter, however, wrote to the commission asking for more time to locate the files and documents related to the GNPC-Societe Generale case.
Source: Daily Graphic
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