The Government of Ghana has announced that it has paid approximately US$1.47 billion to settle longstanding debts in the energy sector, a move officials say will help stabilise the country’s power supply, restore international financial confidence, and reset one of the economy’s most pressing fiscal risks.
In a statement issued by the Ministry of Finance, the payments were made between January and December 2025 under the leadership of President John Dramani Mahama.
The initiative targeted legacy debts that had mounted over years of non-payment and threatened to undermine Ghana’s energy infrastructure and fiscal credibility.
Key Components of the Payment
World Bank Partial Risk Guarantee:
Government fully repaid US$597.15 million (including interest) drawn under the World Bank Partial Risk Guarantee (PRG), which had been depleted due to payment backlogs for gas supplies.
This restoration reinstates a US$500 million guarantee critical for private investment in Ghana’s energy sector, especially the Sankofa Gas Project.
Outstanding Gas Invoices:
Approximately US$480 million was paid to settle overdue bills owed to energy partners ENI and Vitol, bringing Ghana’s obligations to the Sankofa partners fully up to date.
Independent Power Producer (IPP) Arrears:
As part of broader sector reforms, the government paid around US$393 million in legacy debts owed to various IPPs, including Karpowership Ghana, Cenpower Generation, Sunon Asogli, Early Power, and others.
Government Response and Impact
Finance Minister Dr Cassiel Ato Forson described the debt settlement as a demonstration of fiscal discipline and responsible leadership, noting that it has helped restore Ghana’s standing with international partners and removed one of the most destabilising financial burdens facing the economy.
The government also highlighted that adequate budgetary provisions have now been secured to ensure timely payments in the future and that engagements with upstream energy partners will help guarantee full payment for gas supplies and support more reliable electricity generation.
Background
When the Mahama administration assumed office in January 2025, Ghana’s energy sector was under severe strain due to prolonged non-payments to suppliers and producers. The resulting financial pressure had eroded key risk guarantees and raised concerns about the sector’s sustainability.
This decisive settlement aims not only to clear the debt backlog but also to strengthen the foundation for industrial growth and more consistent electricity for homes and businesses nationwide.
