Nigerian government has reached an agreement with the government of Ghana on the modalities to settle the outstanding N33.8 billion owed by the Volta River Authority (VRA).

This is contained in a statement by Mr Ohi Alegbe, Group General Manager, Group Public Affairs Division of the Nigerian National Petroleum Corporation (NNPC), in Abuja on Tuesday.

The statement said that the debt was incurred on gas supplied for power generation by a Nigerian company, N-Gaz.

It said that the agreement was reached between a team led by the Group Managing Director, NNPC, Dr Ibe Kachikwu and the President of Ghana, Mr John Mahama.

It said that highlight of the agreement was the decision that the total sum of gas supply debt would be cleared by February 2016.

The statement also said that the agreement also stipulated that VRA would pay the balance of August and September invoices by October 31.

According to the statement, the parties have also agreed that all other supplies from October will be paid before the due date while the backlog of arrears from 2012 will be defrayed by February 2016.

It would be recalled that Nigeria had threatened to cut gas supply to Ghana by 70 percent over $181 million debt that had accumulated over the years.

The Ghanaian Minister of Power, Dr Kwabena Donkor, had led a delegation to Abuja to hold talks with Nigerian authorities to resolve the issue.

N-Gaz is a joint venture company owned by NNPC, Shell and Chevron that delivers gas through the West African Gas Pipeline Company (WAGPCo) to Ghana. (NAN)