Ripples From BILT Project: Ashanti Port Hauls Transport Ministry To Arbitration
Source: The New Crusading Guide Online
Ashanti Port Services Limited (APSL), the Special Purpose Vehicle (SPV) company formed to represent a consortium member of Afum Quality Limited (AQL) to provide technical expertise and financial aid for the Boankra Integrated Logistical Terminal (BILT) project in the Ashanti region, has dragged the Ministry of Transport (MoT) acting through Ghana Shipper's Council to the Arbitral Tribunal.
The arbitration proceedings, the company said is to address the disputes arising from alleged breaches under of some the BILT Concession Agreement dated 25th September,2020, which was to create a vital infrastructure linking the port of Tema and Takoradi to the inner parts of Ghana and landlocked countries of Burkina Faso, Mali and Niger.
Chiefly amongst the reliefs being sought by the company are: an order for payment of the Three Billion, Six- Hundred and Eighty-Three Million, Seven Hundred and Twenty Thousand, Seven Hundred and Eighty-five United States Dollars (US$3,683,720,785) being the projected income for the BILT operations period of 27 Years, an order for refund of Forty-nine Million United States Dollars (US$49 million) representing 39% of Claimant's share value sold to GPHA, and Special Damages of the expenses incurred by APSL in the region of Sixteen million, Three Hundred thousand United States Dollars (US$16,300,000) with interest.
The company is also seeking from the Arbitration: a declaration that the unilateral termination of the contract by GSA is unlawful, a declaration that the unlawful interferences of the Respondent acting through GSA were material breaches which contributed to GSA erroneously considering Claimant as having failed to meet Financial close, interim injunction restraining the GSA from carrying on any works at the BILT project site pending the hearing and determination of this ARBITRATION.
It is also praying for an order for a refund of the additional sum of sixteen Million United States Dollars (US$16million) paid by GPHA to Justmoh Construction Limited, representing the balance of the total amount for the 39% shares in APSL acquired by the GPHA, General Damages for breach of the Concession Agreement dated 25th September, 2020 by the Respondent, an order for restoration of the contract in favour of Claimant as Concessionaire, and costs, including legal fees.
Details, according to Ashanti Port Services Limited's Notice of Arbitration, dated 17 May, 2024, are that, following an international bidding process, the Ministry of transport (MOT), Acting through the Ghana shippers Authority GSA), awarded the concessionaire rights for the Bank development of the Boankra Integrated Logistics terminal (BILT) project on a build operate and transfer (BOT) basis to Afum Quality Limited (AQL).
The BOT was the 30 years to be managed by the concessionaire; the first three (3) years for the construction of the BILT project, and the remaining twenty-seven (27) years for operations with a projected profit margin of three billion, six-hundred and eighty-three Million, seven hundred and twenty thousand, seven hundred and eighty-five United States dollars (US$3,683,720,785).
Enter, Ashanti Port service Limited, the claimant. It was formed as a special purpose Vehicle (SPV) to represent a consortium member of AQL, providing technical expertise and financial aid for the BILT project.
APSL said after the execution of the Concession Agreement, the Ministry of Transport compelled the APSL to organize a sod-cutting ceremony, prior to fulfilling preconditions necessary for the performance of its obligations under the Concessions Agreement, thus putting Claimant to huge financial expenses.
The Claimant claimed it undertook substantial groundwork for the sod-cutting ceremony, including expanding and gravelling the road from the entrance of the project site to the Administration Block.
According to APSL, it encountered several breaches in the course of its work, including that the sector minister, Kwaku Ofori Asiamah, directed the payment of Thirty-Three Million, Three Hundred Thousand United States Dollars (US$33.3 million) part of GPHA's Shares, directly to Justmoh Construction Limited, contrary the proper pay procedure, which required the first payment of the share values to be paid into the accounts of the APSL, being the concessionaire under the Concession Agreement.
APSL contends further that the GSA together with Justmoh Construction Limited and Vision Consult Limited (Independent Consultant) persist in their unlawful works at the BILT project site, necessitating intervention by the Arbitral Tribunal as stipulated in the Agreement between the parties.
The BILT project falls under natural resource use by the state and was approved and ratified by the Parliament of Ghana in favour of the concessionaire (Claimant herein).
The concessions Agreement was signed on 25th September 2020, is aimed at creating a vital infrastructure linking the port of Tema and Takoradi to the inner parts of Ghana and landlocked countries of Burkina Faso, Mali and Niger.
It is expected to be a free port that would combine unimodal and inter-modal operations aimed at easing congestion at Ghana's seaports thus facilitating the transit trade of Ghana's land-locked neighbours.