TOR debunks GNPC’s claims

The Junior Staff Association of the Tema Oil Refinery (TOR) has refuted claims by the Ghana National Petroleum Corporation (GNPC) that the refinery was not efficient to be given crude to refine.

It said TOR remained viable and by now should have expanded to other petrochemical sub- sectors.  

The secretary to the association, Mr Samuel Boateng, told the GRAPHIC BUSINESS in Accra on October 23, that TOR had a record of refining crude oil for countries such as Nigeria and Burkina Faso, who picked products from TOR. 

“So if we were not viable why were those countries coming here to pick products from here? Does GNPC own the equipment of TOR, what technicality does GNPC has to determine the capacity of our equipment? They are being mischievous,” he said.  

He said that in 2000 when TOR bought a plant, it was able to generate US$250,000 per day and was able to pay almost US$270 million within six years instead of the 10 years originally planned.

“If you are using a vehicle and you allow it to stay and not work for long and you decide to make it work again, do you think you will have it in a comfortable state. When they talk about losses you let the plant run for a week and you shut it down and you know that when you shut and run a plant we make losses of over US$2 million so how do you make a gain. So the question is why don’t we run continuously for a year, and after that if we even shut down you judge the shutdown per the accrued profit that we have made,” he said. 

Raising letters of credit 

Reacting to comments by the GNPC that TOR was unable to raise letters of credit to guarantee that it could deliver in 60 days, Mr Boateng maintained that raising letters of credit (LCs) in the oil business was a matter of negotiation and could be 60 or 90 days, and that normally 90 days was accepted.  

“GNPC is aware that it is normal to negotiate for 90 days but because of their own peculiar interest that is why they are saying that. It is not a law per se but to make it comfortable for both parties it is normally 90 days,” he said. 

Role of BDCs

He blamed TORs woes partly on the existence of the about 22 Bulk Distribution Companies (BDCs) and questioned why government could not give a parcel of jubilee crude to TOR to refine. 

“Why is it that we have allowed people to form about 22 Bulk Distribution Companies and they are all hanging on TOR facilities and are using them as a storage facility? We’ve not been refining almost the whole of this year, except when there is shortage of premix and diesel we are asked to supply 2,500 metric tonnes. If in times of difficulty the country can fall on TOR to refine the small product it has to solve the country’s problem then why can’t we let TOR run continuously? When TOR runs, the profit comes to the state but when the BDCs work, the profits go into individual pockets,” he said.    

Transport of petroleum product 

According to Mr Boateng, unlike TOR which transported products through fuel pipelines and ferry to other depots, the pipelines were left to rot while tankers were used to transport the products to other areas because the farther one went, the higher one was paid. 

“Because they are paid based on the distance, some even take the product all the way to Kumasi and bring it back to Nkawkaw. Such people are not allowing things to work,” he said. 

About two years ago, workers of the Volta Lake Transport Company (VLTC) Limited, a subsidiary of the Volta River Authority (VRA), accused the Bulk Oil Storage & Transport (BOST) of plans to vanquish VLTC.

In a press statement, the workers alleged that the management of BOST was making every move to liquidate the VLTC by secretly constructing a barge at Debre in the Central Gonja District in the Northern region.

Mr Boateng alleged some ‘big men’ own the trucks and were controlling affairs and not making TOR effective.

 Also, he said, the issue of deregulation and pricing of petroleum products in the country aimed at removing the inefficiencies in the sector by allowing private sector participation in the procurement of oil, which previously was limited to TOR, had contributed to the problems TOR faced.

“They realised that they do not have storage facility so if they bring in the products and don’t get storage facilities they would have to pay demurrage so it’s like to ensure that they always get a place to store let’s make TOR like tank farm and that is what is going on,” he said. 

He recalled that recently, the management facilitated crude oil from Nigeria but when it was to be discharged into TOR’s pipeline it was diverted to Cameroun, “and no one could explain so obviously it is in somebody’s interest that we do not work because if we work, all the storage facilities will be full and those people when they bring their finished products they will not get anywhere to keep it and we the workforce representing Ghanaians will suffer.  

However, he said, when TOR worked, all government agencies came to TOR for products after which payment became a burden on TOR. 

He also questioned why banks were not willing to grant TOR letters of credit (LCs) to work when government claimed to have settled TOR’s debt recovery levy. 

Junior staff intended action 

Principally, he said, TOR needed crude oil to work but then the association’s next line of action lay with the Tema District Council of Labour (TDCL) and that all companies in Tema would decide on the next action to take if the refinery did not work. GB