Ghana Water Limited has been ordered to pay US$235 million to the Spanish-owned company operating the Teshie desalination plant following a dispute over the termination of a water purchase agreement.
The Spanish infrastructure group Cox, which owns 95% of the Ghanaian project company, Befesa Desalination Developments Ghana Limited, announced on Monday, September 21, that the International Chamber of Commerce (ICC) arbitration court had issued two final decisions on September 17.
Cox said the amount, net of taxes, relates to payments arising from the termination of the agreement under which Ghana Water purchased treated seawater from the plant. Interest on the award will run from April 1, 2026, until payment is made.
The arbitration tribunal also substantially rejected counterclaims brought by Ghana Water Limited against the project company, including a US$144.5 million claim, and ordered the utility to contribute to the company’s legal costs.
Under a state guarantee attached to the project, the Republic of Ghana has also been found liable for the sums awarded. However, Cox said the project company cannot recover the same amounts twice.
The dispute centres on the Teshie desalination plant, which has remained idle since October 2025 after Ghana Water shut it down amid unresolved contractual issues and concerns over maintenance.
The shutdown has affected water supply to communities including Teshie, Nungua, Spintex, parts of Sakumono and La, forcing residents to rely on alternative sources including water tankers and boreholes.
In February 2026, President John Mahama directed the Finance Minister, the Attorney-General and Ghana Water to negotiate with the plant’s shareholders to resolve the dispute and facilitate the resumption of operations.
Ghana Water Limited Managing Director Adam Mutawakilu subsequently said the utility was working to reach a settlement that would allow the plant to resume supplying water to affected communities.
The financial dispute has its roots in the cost of water supplied by the plant. Ghana Water had reportedly been purchasing desalinated water at GH¢6.75 per unit while the approved tariff allowed it to sell the water at GH¢1.47, creating a significant gap between the purchase price and the revenue generated.
The US$126 million plant was commissioned in 2015 under a 25-year build-own-operate-transfer arrangement. It was designed to produce 60,000 cubic metres of water daily for up to 500,000 people in the Teshie-Nungua catchment.
Cox acquired the assets of the former Spanish engineering company Abengoa in 2023 and subsequently became the majority owner of the Ghanaian project company.
The latest award adds to Ghana’s exposure to international arbitration claims, placing further financial pressure on the state as it seeks to resolve disputes involving major infrastructure and investment projects.
