Gov't negotiates purchase of Teshie Desalination Plant at lower price to avoid $235m arbitration award

The Ghana government is engaged in negotiations to acquire the Teshie Desalination Plant from Befesa in an effort to circumvent a US$235 million arbitration award against the Ghana Water Company Limited (GWCL). The Office of the Attorney-General disclosed that substantial progress has been achieved in these discussions, with the government aiming to purchase the plant at a price significantly lower than the figures involved in the arbitration proceedings.

The Attorney-General's Office announced these developments on Wednesday, September 23, noting that the negotiations commenced prior to the issuance of the final award by the International Chamber of Commerce (ICC) tribunal. According to the government, securing the facility would grant the state full ownership, prevent additional expenses, and restore a crucial water supply to approximately one million residents in eastern Accra.

The statements emphasized that the award, despite its issuance, has not impeded the government's negotiations for the acquisition of the plant to circumvent the payment of the stipulated $235 million. The government projects to finalize these negotiations "within the shortest possible time" to enable the plant's return to full operation.

This development follows a final ruling by the ICC tribunal, which ordered GWCL to pay US$235 million in net termination payments to Befesa Desalination Developments Ghana Ltd. The tribunal validated Befesa's termination of the Water Purchase Agreement but dismissed a separate claim for around US$402 million in alleged unpaid water charges, arguing that the two claims could not be recovered together.

The Teshie plant, capable of producing 60,000 cubic meters of water daily, has been idle since October 2025 due to contractual and maintenance disputes. Its shutdown has impacted water supply to areas including Teshie, Nungua, Spintex, and Sakumono. While the government has not disclosed the proposed purchase price or the specifics of the ongoing negotiations, it emphasizes that the acquisition is being pursued to resolve the financial dispute and restore the plant's full operational capacity.