Refinery: TOR products may struggle to get buyers – Energy expert reveals

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A prominent energy expert has strongly criticized the president’s recent push to revive the ailing Tema Oil Refinery (TOR), asserting that without proper caution, the endeavor may fail.

Mr. Benjamin Nisah emphasized that even if TOR is revitalized as per the President’s aspirations, its products may struggle to find buyers in the market.

Mr. Nisah highlighted the National Petroleum Authority’s (NPA) directive for TOR to refine crude at 15 ppm, labeling it as environmentally unfriendly.

In contrast, he pointed out that a new Chinese-owned refinery at Tema is operating at an eco-friendlier 10 ppm, making its products, particularly those of Sentuo, more appealing in the long run.

Mr Nisah warned that TOR’s products might face challenges in being chosen by market players.

He stressed that TOR requires significant retooling and investment to meet current demands, emphasizing that the revival should not merely be a verbal commitment but a genuine focus on Ghana’s energy security.

Mr Nisah urged the government to allocate substantial funds to TOR, citing the brain drain the company has suffered over the years.

He noted that Sentuo, along with refineries in Dubai, has depleted TOR’s human resources, necessitating urgent measures for revitalization.

In addition, he called for an amendment to the Energy Service Tax, specifically Article 10.64, proposing that the TOR levy be a standalone measure to support the ailing refinery, similar to the Bulk Oil Storage and Transport margin.

Mr. Nisah disclosed that the BOST margin generates annual revenue of GHS 600 million, illustrating the potential financial stability such mechanisms can provide.

Concluding his remarks, Mr Nisah emphasized that making TOR economically viable should be a government priority rather than mere lip service, underlining the necessity for concrete actions to secure the future of the refinery.

 

\Mr Nisah made these comments during an interview on Accra 100.5 FM’s Ghana Yensom morning show, hosted by Odehyeeba Kofi Essuman on Wednesday, January 31, 2024.

 

Last week, President Nana Addo Dankwa Akufo-Addo emphasized the ongoing endeavors to fully revitalize the Tema Oil Refinery (TOR).

 

He announced the inauguration ceremony of the Sentuo Oil Refinery, a Chinese-owned facility located in Tema.

 

President Akufo-Addo underscored the potential of having both the Tema Oil Refinery and the Sentuo Oil Refinery fully operational.

He emphasized that Ghana can locally refine a substantial portion of its oil, thereby reducing dependence on imported refined products.

Energy Minister Dr Mathew Opoku Premier (NAPO) took the opportunity to extend an invitation to foreign investors to actively participate in the energy sector, contributing to its enhanced productivity.

Dr NAPO commended the Sentuo Group for making a significant investment in the Santuo Oil Refinery.

Initially processing 40,000 barrels of oil daily, the Sentuo Oil Refinery aims to gradually increase its capacity to 100,000 barrels per day in its first phase.

On his part, Xu Ning Quan, the Executive Chairman of Sentuo Group, expressed gratitude for the collaborative efforts involving government institutions and traditional authorities that facilitated the establishment of the Sentuo Oil Refinery.

Despite being Chinese-owned, Mr Xu Quan affirmed their deep commitment to Ghana’s progress, particularly in the energy domain, highlighting Ghana as their second home.

Source: Classfmonline.com/Cecil Mensah

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