Ghana Settles US$1.47 Billion Energy Sector Debt, Restores Investor Confidence
The Government of Ghana has announced that it disbursed a total of US$1.470 billion in 2025 to clear longstanding energy sector debts, strengthen financial stability, and rebuild investor confidence in the nation’s power and gas industry.
In a statement issued by the Ministry of Finance, officials said the payments were completed within the first year of President John Mahama’s administration, marking a decisive intervention to address what was described as one of the most pressing threats to Ghana’s fiscal and energy security.
According to the statement, when the administration assumed office in January 2025, the energy sector faced significant strain due to years of unpaid gas supply obligations from the Offshore Cape Three Points (OCTP) field. The situation had led to the complete exhaustion of a US$500 million World Bank Partial Risk Guarantee (PRG), which had been instrumental in attracting nearly US$8 billion in private investment into Ghana’s energy sector through the Sankofa Gas Project.
By December 31, 2025, the government had fully repaid US$597.15 million, including interest, drawn on the World Bank guarantee, effectively restoring the facility and reaffirming Ghana’s credibility with international partners.
The government also settled all outstanding gas invoices owed to ENI and Vitol, totaling approximately US$480 million, ensuring full compliance with its obligations to Sankofa partners. Additionally, agreements were reached with Tullow Oil and Jubilee Field partners to secure timely payments for all gas off-taken, supporting stable electricity generation and industrial growth.
As part of broader reforms, all Independent Power Producer (IPP) agreements were renegotiated to secure better value for money, with approximately US$393 million paid in 2025 alone to clear legacy debts. Improved engagement with upstream partners has also contributed to increased domestic gas production, reducing reliance on expensive liquid fuels.
The Ministry reaffirmed its commitment to fiscal discipline, noting that ongoing implementation of the Cash Waterfall Mechanism ensures timely payments to IPPs, signalling the end of uncontrolled energy sector debt accumulation.
“In a clear demonstration of fiscal discipline and responsible leadership, Government has, as at 31 December 2025, fully repaid US$597.15 million, inclusive of interest, drawn on the World Bank Guarantee. This achievement has restored the facility in full and reaffirmed Ghana’s standing as a credible and reliable partner on the global stage,” the statement read.
