Five MPs sue government, fault parliament
Five members of Parliament have taken the government to court over a commercial agreement they say is illegal and has dire consequences for the operations of the Takoradi Port.
They say even though parliament approved the agreement to restrict the Takoradi Port from further expansion works until a British company, Lonrho Ports, develops an oil and gas free port in the Western Region and recoup its investments, parliament acted wrongly.
The five applicants - Kwaku Kwarteng (Obuasi West); Kwabena Okyere Darko (Takoradi); Joseph Cudjoe (Effia); Mavis Hawa Koomson (Ewutu Senya); and Kofi Brako (Tema Central) - are therefore asking the court to correct the resultant illegality and award substantial cost to the applicants to defray their legal and related costs.
According to the application for a judicial review, the applicants are asking for a “declaration that Clause 7 of the "Ghana Oil and Gas Freeport Project Commercial Agreement" approved by Parliament on 17th July 2014 is inconsistent with Section 5 of the Ghana Ports and Harbours Authority Act, 1986 (PNDCL 160) and to that extent, unlawful and therefore null, void and of no legal effect.”
The suit against the Attorney General being the chief legal representative of the Government of Ghana, also lists the Atuabo Freeport Ghana Limited as an interested party.
In an affidavit supporting the application which is sworn to by Mr. Kwaku Kwarteng, the applicants say that while on Thursday, July 17, parliament gave its approval to the "Ghana Oil and Gas Freeport Project Commercial Agreement", Clause 3 of the "Ghana Oil and Gas Freeport Project Commercial Agreement" grants the Interested Party the right, among other rights, to develop a freeport, build berths at the freeport, develop freeport facilities and render freeport services such as berthing, stevedoring, master porterage, pilotage, lighterage services and provide services which the Interested Party deems relevant for the operation of the freeport in the Western Region of Ghana.
They claim that provisions of Clause 7 of the "Ghana Oil and Gas Freeport Project Commercial Agreement" are inconsistent with existing laws.
The contract provides in part as follows:
"Subject to Clauses 7.1.2 and 7.2 (Port of Takoradi Oil and Gas Operations), the GoG confirms that:
7.1.1 the rights granted to the Developer pursuant to Clause 3 (Grant of Rights) of this Agreement shall be the absolute and sole rights of the Developer in respect of the entire Western Region (including the right to undertake additional Projects, which shall however be the absolute and sole rights of the Developer in respect of the Site only) commencing on the Signing Date and expiring on the expiry of the Initial Debt Tenor (the “Development Rights”);
7.1.2 the GoG shall not, and shall procure that no Relevant Authority shall, grant any concession agreement or other agreement similar to this Agreement, or any Consent or rights containing the same or similar rights as the Development Rights to any third party in respect of the Western Region at any time between the Signing Date and the expiry of the Initial Debt Tenor of the proposed project financing of the Project:
(i) without the express written consent of the Developer; or
(ii) unless there is an urgent commercial need for additional port facilities to support the hydrocarbon industry of Ghana and the Developer has refused to expand the Free Port Project to fulfil the market demand.
7.2 Port of Takoradi Oil and Gas Operations
The Parties agree that the provisions of Clause 7.1 (Absolute and Sole Rights) above shall not be contravened by the Existing Berth or an Additional Berth."
The applicants claim that Section 5(1) of the Ghana Ports & Harbours Authority Act (PNDCL 160) mandates the Ghana Ports & Harbours Authority to develop and manage ports in any parts of Ghana, provide port facilities, carry on the business of berthing, stevedoring, master porterage, pilotage, lighterage services and perform activities the Authority deems relevant to the operation of ports.
Again Section 5(2) of PNDCL 160 empowers the authority to enter into agreement(s) with any person(s) for the operation or provision of port facilities which the authority is empowered to operate or provide.
The applicants maintain that Clause 7 of the "Ghana Oil and Gas Freeport Project Commercial Agreement" imposes a restriction on functions (such as development and operation of ports in the Western Region of Ghana, provision of port facilities, berthing, stevedoring, master porterage, pilotage, lighterage services and the provision of all port-related services) set by section 5(1) and 5(2) of PNDCL 160 for the Ghana Ports & Harbours Authority.
They claim that the restriction imposed by Clause 7 of the "Ghana Oil and Gas Freeport Project Commercial Agreement" on the functions of the Ghana Ports & Harbours Authority is unlawful because it is inconsistent with PNDCL 160 and that Parliament may have approved the Clause 7 of "Ghana Oil and Gas Freeport Project Commercial Agreement" out of oversight.
“This illegality created by Clause 7 of the "Ghana Oil and Gas Freeport Project Commercial Agreement" sets a bad precedence that is dangerous to our rule of law” they maintained, adding that the illegality will not be corrected unless the court intervenes.