Notice2021-12124
Notice of First Amendment to Compact With the Republic of Ghana
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Published
June 10, 2021
Issuing agencies
Millennium Challenge Corporation
Abstract
In accordance with the Millennium Challenge Act of 2003, as amended, the Millennium Challenge Corporation is publishing a summary, justification, and full text of the proposed First Amendment to Millennium Challenge Compact between the United States of America, acting through the Millennium Challenge Corporation, and the Republic of Ghana. Representatives of the United States Government and the Government of Ghana plan to conclude the Amendment in June 2021.
Full Text
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<title>Federal Register, Volume 86 Issue 110 (Thursday, June 10, 2021)</title>
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[Federal Register Volume 86, Number 110 (Thursday, June 10, 2021)]
[Notices]
[Pages 30988-30991]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-12124]
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MILLENNIUM CHALLENGE CORPORATION
[MCC FR 21-05]
Notice of First Amendment to Compact With the Republic of Ghana
AGENCY: Millennium Challenge Corporation.
ACTION: Notice.
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SUMMARY: In accordance with the Millennium Challenge Act of 2003, as
amended, the Millennium Challenge Corporation is publishing a summary,
justification, and full text of the proposed First Amendment to
Millennium Challenge Compact between the United States of America,
acting through the Millennium Challenge Corporation, and the Republic
of Ghana. Representatives of the United States Government and the
Government of Ghana plan to conclude the Amendment in June 2021.
(Authority: 22 U.S.C. 7708 (i) (2))
Dated: June 4, 2021.
Thomas G. Hohenthaner,
Acting VP/General Counsel and Corporate Secretary.
Summary of First Amendment to Millennium Challenge Compact With the
Republic of Ghana
The Board of Directors of the Millennium Challenge Corporation
(``MCC'') has approved an amendment (the ``Amendment'') to the existing
US$308.2 million, five-year Millennium Challenge Compact between the
United States of America, acting through MCC, and the Republic of Ghana
(the ``Compact'').
Background
The Compact was signed August 5, 2014 and entered into force on
September 6, 2016. The Compact aims to improve Ghana's power sector
through investments that provide more reliable and affordable
electricity to Ghana's businesses and households. Compact projects
focus on improving the infrastructure in the country's southern
electricity distribution network, advancing energy efficiency programs,
increasing power reliability and access to key markets, and
strengthening Ghana's electricity sector regulatory institutions. The
investment strategy is based on an integrated loss management approach
to reduce technical and commercial losses in the distribution system,
reduce distribution system vulnerability, and reduce the frequency and
duration of power outages.
Scope of the Amendment
MCC proposes to extend the term of the Compact for an additional
nine-months to June 6, 2022 and to provide additional funding up to
$7,651,395. The term extension is necessary to mitigate implementation
delays due to the COVID-19 pandemic and to complete infrastructure
projects as originally contemplated. The proposed additional funding
will be used to cover additional program administration and related
oversight costs associated with extending the Compact's term.
Justification for the Amendment
In late January 2020, MCC received the first reports from Ghana of
COVID-19-related manufacturing delays from equipment suppliers. On
March 12, 2020, the Government of Ghana confirmed its first two cases
of COVID-19 and later announced measures to prevent and control the
virus' spread. These included mandated social distancing, restrictions
on foreign national entry to the country, border closures, and partial
lockdowns across major cities, including the capital city of Accra, the
location of major compact project sites. The impact of these measures
was immediate and seriously affected the implementation timeline of
compact activities.
Measures to mitigate the spread of COVID-19 led to global supply
chain disruptions and restrictions on the movement of technical
experts, project
[[Page 30989]]
management staff, consultants, and contractors locally and
internationally, thereby slowing procurements, the delivery of
equipment and materials, factory testing and acceptance of key
components, installation of equipment at project sites, and physical
activity on project sites. In addition, temporary shutdowns of work
sites, temporary government office closures, changes in priorities by
government implementing entities, and COVID-19 infections among
government staff and the consultants and contractors working on the
projects have disrupted compact implementation.
Extending the compact term will enable MCC and the Government of
Ghana to complete and hand over all ongoing projects to the beneficiary
institutions at the required quality, without compromising health,
safety, and environmental standards, and will reduce sustainability
risks through the necessary attention to testing, commissioning,
training of utility operators and technicians, and additional oversight
during the commencement of the defects notification periods associated
with these projects. As COVID-19 has disrupted program activities and
timelines, an extended compact term will maximize long-term results,
benefits for the citizens of Ghana, and MCC's return on investment, and
benefit the compact program as a whole. The additional MCC funding is
necessary for and will be used to support oversight and other
administrative functions during the additional nine months of the
compact term.
First Amendment to Millennium Challenge Compact Between the United
States of America, Acting Through the Millennium Challenge Corporation
and the Republic of Ghana
First Amendment to Millennium Challenge Compact
This First Amendment to Millennium Challenge Compact (this
``Amendment''), is made by and between the United States of America,
acting through the Millennium Challenge Corporation, a United States
government corporation (``MCC''), and the Republic of Ghana, acting
through its government (the ``Government'') (each referred to herein
individually as a ``Party'' and collectively, as the ``Parties''). All
capitalized terms used in this Amendment that are not otherwise defined
herein have the meanings given to such terms in the Compact (as defined
below).
Recitals
Whereas, the Parties signed that certain Millennium Challenge
Compact by and between the United States of America, acting through
MCC, and the Republic of Ghana, on August 5, 2014 (as modified, the
``Compact'');
Whereas, Section 7.4 of the Compact provides for a Compact Term of
five (5) years after its entry into force;
Whereas, the Compact entered into force on September 6, 2016;
Whereas, implementation of the compact program has been adversely
affected and delayed by the coronavirus pandemic;
Whereas, the Parties now desire to extend the Compact Term by an
additional nine (9) months (the ``Extension''), and to increase
assistance under the Compact for related administrative and oversight
costs, to allow the Government more time to implement and complete the
Projects in order to fully achieve the Compact Goal, Project Objectives
and Program Objectives; and
Whereas, pursuant to Section 6.2(a) of the Compact, the Parties
desire to amend the Compact as more fully described herein to
memorialize the Extension.
Now, therefore, the Parties hereby agree as follows:
Amendments
1. Amendment to Section 2.1.
Section 2.1 (Program Funding) of the Compact is amended and
restated to read as follows:
``Section 2.1 Program Funding. Upon entry into force of this
Compact in accordance with Section 7.3, MCC will grant to the
Government, under the terms of this Compact, an amount not to exceed
Three Hundred One Million, Nine Hundred Seventy-Four Thousand, Forty-
Six United States Dollars (US$301,974,046) (``Program Funding'') for
use by the Government to implement the Program. The allocation of
Program Funding is generally described in Annex II.''
2. Amendment to Section 2.2.
Section 2.2(a) (Compact Implementation Funding) of the Compact is
amended and restated to read as follows:
``(a) Upon the signing of this Compact, MCC will grant to the
Government, under the terms of this Compact and in addition to the
Program Funding described in Section 2.1, an amount not to exceed
Thirteen Million Eight Hundred Seventy-Seven Thousand, Three Hundred
Forty-Nine United States Dollars (US$13,877,349) (``Compact
Implementation Funding'') under Section 609(g) of the Millennium
Challenge Act of 2003, as amended (the ``MCA Act''), for use by the
Government to facilitate implementation of this Compact, including for
the following purposes:
(i) Financial management and procurement activities;
(ii) administrative activities (including start-up costs such as
staff salaries) and administrative support expenses such as rent,
computers and other information technology or capital equipment;
(iii) monitoring and evaluation activities;
(iv) feasibility, design and other project preparatory studies; and
(v) other activities to facilitate Compact implementation as
approved by MCC.
The allocation of Compact Implementation Funding is generally
described in Annex II.''
3. Amendment to Section 7.4.
Section 7.4 (Compact Term) of the Compact is amended and restated
to read as follows:
``Section 7.4 Compact Term. This Compact will remain in force for
five (5) years and nine (9) months after its entry into force, unless
terminated earlier under Section 5.1 (the ``Compact Term'').''
4. Amendments to Annex II (Multi-Year Financial Plan Summary).
(a) Section 2 of Annex II (Multi-Year Financial Plan Summary) to
the Compact is amended and restated to read as follows:
``2. Government Contribution. During the Compact Term, the
Government will make contributions, relative to its national budget and
taking into account prevailing economic conditions, as are necessary to
carry out the Government's responsibilities under Section 2.6(a) of
this Compact. These contributions may include in-kind and financial
contributions (including obligations of Ghana on any debt incurred
toward meeting these contribution obligations). In connection with this
obligation the Government has developed a budget over the Compact Term
to complement MCC Funding through budget allocations to the Projects.
The Government initially anticipates making contributions of
approximately Twenty-Three Million, Six Hundred Eighty-Eight Thousand,
Eight Hundred Fifty-Five United States Dollars (US$23,688,855 (or 7.5
percent of the amount of MCC Funding provided under this Compact) over
the Compact Term. Such contribution shall be in addition to the
Government's spending allocated toward the Project Objectives in its
budget for the year immediately
[[Page 30990]]
preceding the establishment of this Compact. The Government's
contribution shall be subject to any legal requirements in Ghana for
the budgeting and appropriation of such contribution, including
approval of the Government's annual budget by its legislature. The
Parties may set forth in the Program Implementation Agreement or other
appropriate Supplemental Agreements certain requirements regarding this
Government Contribution, which requirements may be conditions precedent
to the Disbursement of MCC Funding. During implementation of the
Program, the Government's contributions may be modified or new
contributions added with MCC approval, provided that the modified or
new contributions continue to advance the Project Objectives.''
(b) Exhibit A to Annex II (Multi-Year Financial Plan Summary) to
the Compact is deleted in its entirety and replaced by revised Exhibit
A set forth in Annex I to this Amendment.
General Provisions
1. Further Assurances.
Each Party hereby covenants and agrees, without necessity of any
further consideration, to execute and deliver any and all such further
documents and take any and all such other action as may be reasonably
necessary or appropriate to carry out the intent and purpose of this
Amendment.
2. Effect of this Amendment.
From and after the date this Amendment enters into force, the
Compact and this Amendment shall be read together and construed as one
document, and each reference in the Compact to the ``Compact,''
``hereunder,'' ``hereof'' or words of like import referring to the
Compact, and each reference to the ``Compact,'' ``thereunder,''
``thereof'' or words of like import in any Supplemental Agreement or in
any other document or instrument delivered pursuant to the Compact or
any Supplemental Agreement, shall mean and be construed as a reference
to the Compact, as amended by this Amendment.
3. Limitations.
Except as expressly amended by this Amendment, all of the
provisions of the Compact remain unchanged and in full force and
effect.
4. Governing Law.
The Parties acknowledge and agree that this Amendment is an
international agreement entered into for the purpose of amending the
Compact and as such will be interpreted in a manner consistent with the
Compact and is governed by international law.
Annex I: Revised Exhibit A to Annex II to the Compact Multi-Year
Financial Plan Summary
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Proposed
Compact program tranche I Current additional MCC Revised MYFP
approved MYFP grant funds
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1. ECG Financial & Operational Turnaround Project-Tranche 1..... .............. .............. ..............
1.1 Private Sector Participation................................ 6,162,736 .............. 6,162,736
1.2 Modernizing ECG Operations.................................. 31,186,058 3,076,668 34,262,726
1.3 Commercial Loss Reduction................................... 17,236,519 .............. 17,236,519
1.4 Technical Loss Reduction.................................... 155,326,548 318,978 155,645,527
1.5 Outage Reduction............................................ 354,406 .............. 354,406
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Subtotal.................................................... 210,266,267 3,395,646 213,661,914
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2. NEDCo Financial & Operational Turnaround Project............. .............. .............. ..............
2.1 Private Sector Participation................................ 0 .............. 0
2.2 Modernizing NEDCo Operations................................ 1,175,475 .............. 1,175,475
2.3 Commercial Loss Reduction................................... 0 .............. 0
2.4 Technical Loss Reduction.................................... 0 .............. 0
2.5 Outage Reduction............................................ 0 .............. 0
2.6 Tamale Service Area Improvement............................. 0 .............. 0
2.7 Commercial Development...................................... 0 .............. 0
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Subtotal.................................................... 1,175,475 .............. 1,175,475
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3. Regulatory Strengthening and Capacity Building Project....... .............. .............. ..............
3.1 Sector Performance Monitoring Ca............................ 797,672 .............. 797,672
3.2 Tariff Review & Regulation.................................. 2,057,115 .............. 2,057,115
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Subtotal.................................................... 2,854,787 .............. 2,854,787
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4. Access Project............................................... .............. .............. ..............
4.1 Improve Electricity Supply to MS............................ 78,070 .............. 78,070
4.2 Improve Service Delivery/Strength........................... 821,930 .............. 821,930
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Subtotal.................................................... 900,000 .............. 900,000
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5. Power Sector Generation Improvement Project.................. .............. .............. ..............
5.1 Operationalize ``Gas to Power'' Plan........................ 0 .............. 0
5.2 Facilitate LNG development.................................. 0 .............. 0
5.3 Strengthen IPP framework.................................... 0 .............. 0
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Subtotal.................................................... 0 .............. 0
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6. Energy Efficiency & Demand Side Management Project........... .............. .............. ..............
6.1 Development and Enforcement of Standards.................... 4,268,865 .............. 4,268,865
6.2 Improve Energy Auditing..................................... 3,900,000 .............. 3,900,000
6.3 Education and Public Information............................ 1,755,000 .............. 1,755,000
6.4 Demand Side Management Infrastructure....................... 12,373,934 .............. 12,373,934
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[[Page 30991]]
Subtotal.................................................... 22,297,799 .............. 22,297,799
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7. Monitoring and Evaluation (M&E).............................. .............. .............. ..............
7.1. Monitoring and Evaluation (M&E)............................ 7,308,437 .............. 7,308,437
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Subtotal.................................................... 7,308,437 .............. 7,308,437
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8. Program Administration and Oversight......................... .............. .............. ..............
8.1 MiDA Administration......................................... 32,373,374 2,898,597 35,271,971
8.2 Fiscal & Procurement Agents................................. 9,763,852 1,345,902 11,109,754
8.3 Audit & Compliance.......................................... 749,850 11,250 761,100
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Subtotal.................................................... 42,887,076 4,255,749 47,142,825
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9. ECG Financial and Operational Turnaround Project-Tranche 2... .............. .............. ..............
9.1 Private Sector Participation................................ 0 .............. 0
9.2 Modernizing ECG Operations.................................. 2,120,755 .............. 2,120,755
9.3 Commercial Loss Reduction................................... 0 .............. 0
9.4 Technical Loss Reduction.................................... 4,512,055 .............. 4,512,055
9.5 Outage Reduction............................................ 0 .............. 0
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Subtotal.................................................... 6,632,810 .............. 6,632,810
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TOTAL Program Funding........................................... 294,322,651 7,651,395 301,974,046
TOTAL Compact Implementation Funding............................ 13,877,349 .............. 13,877,349
TOTAL MCC Funding............................................... 308,200,000 7,651,395 315,851,395
Total Government Contributions.................................. 23,115,000 573,855 23,688,855
TOTAL COMPACT + GOVERNMENT CONTRIBUTION......................... 331,315,000 8,225,250 339,540,250
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[FR Doc. 2021-12124 Filed 6-9-21; 8:45 am]
BILLING CODE 9211-03-P
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</html>Indexed from Federal Register on June 10, 2021.
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