The senators have written a communication to the Plenary of the Liberian Senate drawing the attention to a situation which, if not properly addressed, will have the propensity to deny over 8,000 citizens and residents of Grand Bassa County their livelihood, and by extension negatively impact the nation’s economy.
The communication, dated June 18, 2012 was written by Senator Gbehzohngar Findley, President Pro-Tempore of the Liberian Senate and Senator John Francis Whitfield and was read in session Tuesday.
The Senators first presented a historical synopsis of two agreements signed between Buchanan Renewables (Monrovia) Power, Inc. and the Government of Liberia in 2009 for the production and sale of electricity in Liberia:
“A Power Purchase Agreement signed on January 16, 2009 between BRP and the Liberia Electricity Corporation, LEC (approved by the Minister of Finance and attested to by the Minister of Justice); under this Agreement, LEC is to purchase the electric power to be provided by a BRP built electric power plant in Montserrado County; and a Concession Agreement for the construction and operation of an electric power plant in Montserrado County by BRP, signed on January 16, 2009 between BRP and the Government of Liberia; it was signed by the Minister of Lands, Mines and Energy, the Minister of Finance, the Chairman of the National Investment Commission; attested to by the Minister of Justice; approved by the President of Liberia, and subsequently ratified by the Legislature”.
Referencing a recent decision by the House of Representatives to recommend a moratorium on the exportation of woodchips by BRF because of BRP’s alleged failure to construct and operate the electric power plant, the Senators clarified that the two companies, were separate business entities legally registered and pay taxes to the Government of Liberia.
Senators Findley and Whitfield said though the recommendation by the House of Representatives is yet to be enforced by the President, it is beginning to send negative signals to over one thousand (1000) workers in the employ of BRF and their dependents as BRF is now threatening closure if the Government of Liberia illegally imposes sanction on the company’s export of woodchips as a consequence of BRP not constructing the power plant.
“Considering particularly the direct survival interest of the people of Grand Bassa County, and the general economic benefits that could accrue to Liberia in the continuous existence of BRF’s activities in Liberia, we engaged the management of Buchanan Renewables BV (BR), which has ownership in both BRF and BRP to solicit information on BRP’s alleged failure to construct and operate the electrical power plant, contingent on the Concession Agreement of January 16, 2009:
Information we received from Buchanan Renewables BV (BR) on the matter suggests that BRP and its US Government lender, the Overseas Private Investment Corporation (OPIC), have met all their contractual commitments under the Agreement, but that both the LEC and the Government of Liberia have constantly failed to meet their obligations under the Agreements, consequently erecting a barrier to the timely realization of the electric power plant”.
According to the Grand Bassa County Senators, information they have gathered revealed that BRP, in its determination to uphold its obligations under the agreements has accomplished the following:
1. BRP’s shareholders have spent over US$20 million to develop the power project.
2. BRP arranged with OPIC for a loan of US$112 million to finance a major portion of the US$150 million project, the balance of which is to be provided as equity by the shareholders.
3. BRP carried out the required environmental and social studies, including an Environmental Social Impact Assessment and a resettlement action plan related to the transmission line.
4. BRP repeatedly negotiated and, because of delays by the Government and LEC that caused those contracts to expire, renegotiated the construction contracts to build the plant and the transmission line.
The Senators found out that the Liberia Electricity Corporation (LEC) and the Government have repeatedly refused to finalize the documentation to allow financial close so that construction could begin.
They quoted BRP as saying “these actions and the costs incurred were based upon the belief that signed agreements with the Government of Liberia and LEC, including the Concession Agreement ratified by the Legislature would be honored, and that the failure on the part of the Government and LEC to meet their contractual obligations has not only caused serious economic harm to BRP and its shareholders and the people of Liberia, but as a result of recent actions by the House of Representatives has threatened the viability of BRF as well”.
Senators Findley and Whitfield then craved the indulgence of their colleagues to see the urgent and compelling need to probe the matter by calling the parties concerned for a hearing aimed at establishing the facts regarding this crucial matter in the interest of Bassa citizens and the nation and subsequently recommending a workable solution to the situation.