Tonga Power has moved to clarify its borrowing position, stating total debt stands at $20.47 million, but the statement does not address the financing structure tied to its Matatoa headquarters that has prompted legal review.

The statement, issued on May 1, says the company is aware of speculation and confirms its borrowings, based on audited financial statements, were $20.47 million as at June 2025.

It adds that the borrowing position has not changed materially since that time.

The clarification follows reporting on a Crown lease at Matatoa that underpins a financing structure exceeding $58 million, and a sublease arrangement involving a government ministry that is now the subject of legal advice.

The company’s statement does not refer to the lease, the associated mortgage facility, or the sublease arrangement.

It also does not address the relationship between its reported borrowings and the larger financing facility registered against the lease.

That distinction is central to the issue.

While company borrowings reflect debt recorded in financial statements, a mortgage facility secured against land can represent a higher approved borrowing limit or form part of a broader financing structure.

The Matatoa site, which houses Tonga Power’s headquarters and distribution operations, is held under a Crown lease and has been mortgaged to support lending that records show has increased over time.

Part of the site was later subleased to MEIDECC, raising questions about how public land, private lease arrangements and government occupancy intersect.

The Government has since sought legal advice on the sublease, including concerns about the return to the Crown.

Tonga Power’s statement does not comment on those matters.

Questions remain around who holds the borrowing obligations tied to the lease, how the financing structure operates, and whether all approvals required under the lease were obtained.

Further clarification is also being sought on the terms of the sublease and how any rental flows are distributed.

The Government has indicated the matter is under review.

Further reporting will follow.