A decision needs to be made on TOR
The Tema Oil Refinery (TOR), Ghana’s only 45,000-barrels-per-day (bpd) refinery, has appallingly not refined a barrel of oil since July 2012.
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This is so inexcusable viewed against the backdrop that the country now produces an average of 100,000 bpd of crude oil from its Jubilee field, which pumped out its first commercial oil in December 2010.
TOR’s wretchedness, while to some extent is attributable to its own operational inefficiencies, is largely the outcome of government’s cluelessness or a deliberate lack of political will or both in fixing the malaise afflicting the giant organisation which politicians see more as a cash cow that they milk to feed their insatiable hunger for financial liquidity than a strategic beast of burden that is central to the country’s energy security.
While several governments have used the strategic importance of TOR as reason for imposing levies on denizens, under the pretext of clearing up the refinery’s perennial, debilitating indebtedness – and bringing it back to efficiency, accounting for the money accruing from the levies and its utilisation for the said purpose has always been conveniently murky.
It’s no gainsaying that shedding off the non-core operations of TOR, such as running a healthcare facility, recreational business units, among others, will help slash operational costs of the organisation.
However, fresh investments to upgrade the refinery are imperative if it is to take advantage of new opportunities emerging in the country.
But that seems to be posing an unnecessarily massive headache for the Ministry of Energy and Petroleum, the main government agency for the energy sector, and other regulatory agencies of the sector.
A brief tracking of the history of TOR to its present situation makes a compelling case for lack of transparency in its management being central to the organisation’s woes.
TOR has, over the years, been bedevilled by crude oil supply challenges, in addition to poor financial management that had at different times led to disruptions in refining operations at the plant. And so though the current non-functioning at the refinery is not unfamiliar, it is of the longest duration, and strangely so since the country’s crude could be lifted to TOR easily, cutting out supply risks.
The challenge concerning constant delivery of oil highlights the need for fresh injection of capital into the refinery to enable it to add value to the country’s crude oil.
This is more critical, as world crude prices have shown a dramatic decline in recent weeks, a phenomenon that analysts believe will persist into the foreseeable future, leading to forecasts of crude prices staying below US$100 well into next year.
Of course, in recent times the Ministry of Energy has announced an expected joint venture arrangement with Petro Saudi for investments in TOR, with the aim of bringing it to efficient and profitable ways.
Whatever the case may be, it reveals the government’s confidence in TOR’s strategic significance to Ghana’s energy security, but that confidence must be matched by more disclosure to the public on the operations of TOR in particular and the energy sector in general
Promoting transparency is not only vital to helping clear the cloud of secrecy that has covered TOR’s operations and invariably reduced it to a white elephant but also critical to eradicating political influence in its running.
It invariably calls for the political muscle to un-muzzle the cow while it treads the corn.
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