GPHA, MPS in dispute over contract details of Tema Port Expansion project

The Ghana Ports and Harbours Authority (GPHA) is in dispute with the Meridian Port Services (MPS) Limited over the contract details of the US$1.5-billion Tema Port Expansion project, prompting the GPHA to petition the Presidency for direction.

The dispute, which started last year, borders on three issues — the stake of the GPHA in the project after completion; which institution (the GPHA or the MPS) should be given the right to determine and impose tariffs, and how long the MPS should be allowed to manage the facility before transferring it to the GPHA.

The Daily Graphic is reliably informed that the disagreement between the two entities began from February 2017 until the Presidency was petitioned and a committee set up about four months ago to look into the contract and prescribe a solution.

Disagreement

The General Manager in charge of Marketing and Corporate Affairs at the GPHA, Mrs Esther Gyebi-Donkor, told the Daily Graphic that although both parties had initially agreed that the build, operate and transfer (BOT) contract would last for 30 years, with the GPHA owning 30 per cent of the facility and its right to determine and impose tariffs preserved, a final contract document meant to be signed contained contrary details.

“For instance, the GPHA noticed that its agreed 30 per cent shareholding has been diluted to 15 per cent,” she said.

She said in the new contract, the MPS was seeking to control tariffs and “we said no because the onus lies on the port authority to ensure that business within the port is cost efficient”.

“Also, contrary to what we agreed on, the period that the MPS is to operate the facility and transfer it to the GPHA has been increased from 30 to 35 years,” she said.

Meridian’s response

The Manager in charge of Legal, Licence and Permits at the MPS, Mr Frank Ebo Brown, however, told the Daily Graphic that no such agreement existed in the first place.

He challenged the GPHA to publish any agreement between the two parties that suggested that the present contract had been altered.

According to him, the Tema Port Expansion project made for a world-class harbour infrastructure for the next 100 years and that the MPS would only operate it for 35 years and transfer it to the state.

With regard to tariffs, he said it would be untrue for any person to suggest that the MPS was trying to control tariffs in the contract and that what the MPS sought to do was work in consultation with the GPHA to set tariffs.

On the shareholding of the GPHA, Mr Brown declined to comment, except to say that the contact did not contain any agreement on shareholding.

“Every contract has clauses for either review or termination and if any of these clauses will be triggered, we are expected to be informed, but as I speak we are not aware of any contract review,” he added.

Background

The MPS is executing the port expansion project (terminal three), which involves the building of a 3.5-kilometre breakwater and an access channel harbouring 16 metres deepwater berths to accommodate larger vessels with sophisticated port handling equipment.

The Tema Port Expansion project is designed to provide a world class harbour infrastructure for the next 100 years.

In line with the project, about 127 hectares of land has so far been reclaimed from the sea.

Under the arrangement, the MPS is expected to complete two berths by June next year for operations to start and continue work on the next two berths in 2020.