Gabon reviews power deal with Karpowership amid budget scrutiny

Gabon is reassessing its power purchase agreement with Karpowership, the Turkish floating power plant operator owned by Karadeniz Holding, amid growing concerns over fiscal responsibility and industrial efficiency. Official reports indicate that Libreville currently pays 1.8 billion CFA francs monthly for a theoretical capacity of 150 megawatts, yet actual power delivered hovers between 80 and 90 megawatts. This discrepancy has intensified scrutiny as the transitional government prioritizes transparency in public spending.

From temporary fix to entrenched dependency

The arrangement with the Turkish company was initially framed as a stopgap measure to address Gabon’s chronic electricity shortfalls. Aging thermal plants and inconsistent hydroelectric output during dry seasons had pushed the national grid to the brink, prompting officials to turn to powerships—mobile floating power stations anchored near Owendo. While this solution, successfully deployed in Ghana, Sierra Leone, and Senegal, delivers rapid capacity boosts, it comes at a premium compared to conventional land-based plants.

What began as a provisional arrangement has now solidified into a structural dependency. Despite progress on domestic projects like the Kinguélé Aval dam and planned gas-fired plants, the SEEG continues to rely on external sources to meet peak demand. Over the past year alone, payments to Karpowership have exceeded 21 billion CFA francs, a significant burden for a nation under tight fiscal oversight.

Mounting economic and technical concerns

The core issue lies in the mismatch between contracted capacity and actual delivery. Paying for 150 megawatts while receiving less than two-thirds of that power artificially inflates the effective cost per megawatt. Critics within government and technical circles argue that the contract’s terms disproportionately shield the Turkish operator from demand fluctuations and technical failures. Since assuming office in August 2023, the transitional administration has launched a comprehensive audit of major public contracts inherited from the previous regime.

Karpowership operates across Africa, managing dozens of powerships in over a dozen countries, with a strong presence in Sub-Saharan Africa. Its strength lies in rapid deployment—units ranging from 30 to 470 megawatts can be operational in weeks. However, the model creates long-term dependency: disconnecting a powership without immediate alternatives risks plunging the grid back into blackouts.

Negotiation or phased exit? Energy policy at a crossroads

The challenge is twofold: financial and operational. Terminating the agreement without securing equivalent replacement capacity would jeopardize grid stability. While domestic solutions like the Kinguélé Aval hydroelectric project and future gas plants are in development, they are not expected to reach full capacity for two to three years. This leaves policymakers with limited immediate options.

Three potential paths are under consideration. The first involves renegotiating financial terms to tie payments strictly to actual power delivered. A second approach favors a gradual phase-out, synchronized with the ramp-up of new infrastructure. A third, more assertive option would entail termination with potential recourse to alternative suppliers, though this carries risks of international disputes. The decision will shape Gabon’s energy policy trajectory and test the credibility of its industrial sovereignty agenda.

Key considerations

Any resolution must balance fiscal prudence with grid reliability while accelerating domestic energy projects to reduce reliance on external suppliers.