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PDS suspension: Meralco wants to pull out of Ghana's power sector
Meralco, the Philippino company that is part of the companies in charge of power distribution, is planning to pull out its investment from Ghana’s electricity distribution utility, a Manila-based news portal has reported.
The Philippine Star on Friday said a top official of Meralco said the decision to pull out from Ghana will happen unless the political situation in the country improves.
“We’re still waiting for developments. It’s a Ghana government issue,” Meralco President and CEO Ray Espinosa is quoted by the news portal.
According to the news website, Espinosa fears that the Meralco deal is exposed to political risk following the suspension of concessionaire agreement between the Government of Ghana and Power Distribution Services (PDS).
“The terms are good, but if we will be exposed to these types of uncertainties, we might as well pull out and just devote our attention to the country. And even in Asia, it’s more stable. Maybe we don’t have the DNA for that kind of risk in Africa yet,” Espinosa is quoted by The Philippine Star.
Government of Ghana in July suspended the concession for the operation and maintenance of the assets and facilities of the Electricity Company of Ghana (ECG) awarded to PDS.
PDS is a consortium between Meralco through Meridian Power Ventures Ltd. (30 percent), Angola-based firm AEnergia SA (19 per cent), and three Ghanaian firms namely TG Energy Solution Ghana (18 per cent); GTS Engineering Ghana Ltd. (10 per cent), and TBK Ghana Ltd. (10 per cent).
The suspension order was due to alleged material breaches in the provision of the demand guarantees by PDS, which were key prerequisites for the turnover of the assets and facilities.
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