Government has cleared $1.47 billion in energy-sector debts in the 2025 fiscal year, a move officials say has rescued the sector from collapse and restored investor confidence.

Payments covered outstanding obligations across the energy value chain, including $597.15 million interest included to fully restore the depleted World Bank Partial Risk Guarantee for gas supplies from the Sankofa Field. The reinstatement of the guarantee reactivates World Bank risk cover for natural gas payments to ENI and Vitol.

An additional $480 million was paid to settle all outstanding gas invoices owed to ENI and Vitol for power generation, making Ghana current on its obligations to Sankofa partners.

Government also cleared $393 million in inherited debts owed to Independent Power Producers (IPPs), anchoring recent gains in stabilising the power sector. Major payments included Karpower ($120m), Cenpower ($59.44m), Sunon Asogli ($54m), Early Power ($42m), and Twin City Energy ($37.98m), among others.

According to the Ministry of Finance, the payments made between January and December 2025 were supported by disciplined implementation of the Cash Waterfall Mechanism, helping government remain current on most IPP invoices.

Officials say the Mahama administration has also renegotiated all IPP contracts to secure better value for money and engaged upstream partners, including Jubilee Field operators, to ensure reliable gas supply and reduce dependence on expensive liquid fuels.

Government has assured stakeholders that tighter financial controls and improved payment discipline mean the era of uncontrolled energy-sector debt accumulation is over.

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