Gabon rethinks costly power deal with Turkish energy firm

Gabon is reassessing its power purchase agreement with Karpowership, a subsidiary of Turkey’s Karadeniz Holding, amid growing concerns over rising costs and operational inefficiencies. Officials in Libreville report that the government currently spends 1.8 billion Central African francs monthly for a theoretical capacity of 150 megawatts, yet actual power delivered fluctuates between 80 and 90 megawatts. This discrepancy has intensified scrutiny over public expenditure transparency during the ongoing transition period.

From temporary fix to entrenched dependency

The agreement with the Turkish operator was initially framed as an emergency measure to address chronic power shortages. Aging thermal plants and unreliable hydroelectric generation during dry seasons had pushed the national grid to the brink. Powerships—floating power plants anchored offshore near Owendo—offered a rapid solution by injecting additional megawatts within weeks. This approach has been deployed successfully in neighboring countries like Ghana, Sierra Leone, and Senegal, though at a premium compared to land-based alternatives.

What began as a stopgap has since become structural. While local projects, including hydroelectric dams and gas-fired plants, have progressed, they have not yet offset the need for external power. The Gabonese Electricity and Water Company (SEEG) remains locked into the Turkish contract, especially during peak demand periods. Over the past year, payments to Karpowership have totaled over 21 billion Central African francs—a significant financial burden for a nation under fiscal scrutiny.

Mounting economic and technical pressure

The core issue lies in the mismatch between billed capacity and actual output. Paying for 150 megawatts while receiving far less inflates the real cost per unit of electricity. Analysts and officials within the energy sector argue that the contract’s terms disproportionately favor the operator, offering little protection against demand fluctuations or technical disruptions. Since assuming office in August 2023, the transitional government has prioritized audits of major public contracts inherited from the previous administration.

Karpowership is not alone in Africa’s energy landscape. The company operates dozens of floating power units across more than a dozen sub-Saharan countries, with capacities ranging from 30 to 470 megawatts. While its rapid deployment model appeals to cash-strapped nations, it also creates long-term dependency—exiting such agreements without alternative sources risks plunging grids back into instability.

Strategic choices ahead for Gabon’s energy future

The challenge now is balancing financial prudence with operational stability. Terminating the contract abruptly could trigger severe supply shocks, given that key projects like the Kinguélé Aval dam (partnered with Meridiam) and planned gas plants are still years away from full operation. Policymakers must weigh three primary options: renegotiating payment terms to reflect actual usage, phasing out the contract in tandem with new infrastructure, or pursuing a full exit—even at the risk of international arbitration.

The decision will not only shape Gabon’s immediate energy security but also signal the country’s broader commitment to industrial sovereignty under its current leadership. Insiders indicate that a final strategy could emerge within weeks as the national energy roadmap takes clearer form.