President John Dramani Mahama has directed a review of the policy requiring Tema Oil Refinery (TOR) and Sentuo Oil Refinery to pay for Ghana’s locally produced crude oil in US dollars. This directive, issued on Saturday, 1 August 2026, aims to explore the feasibility of using Ghana cedis for these transactions.
Energy and Green Transition Minister John Jinapor disclosed this instruction during the commissioning of refurbished facilities at TOR. President Mahama questioned why domestic refineries, which process crude and sell petroleum products in cedis, must obtain US dollars to purchase locally produced oil. This practice, he noted, creates unnecessary demand for foreign exchange.
This initiative aligns with broader efforts to stabilize the Ghana cedi and reduce pressure on the country's foreign exchange reserves. Ghana has consistently faced challenges with cedi depreciation, making local currency strengthening a key economic objective. Reducing dollar demand from major state-owned enterprises like TOR could significantly impact the forex market.
Minister Jinapor explained that the current arrangement is mandated by the Petroleum Holding Fund and the Petroleum Revenue Management Act. These laws require crude oil payments to be made in foreign currency. However, President Mahama instructed a re-evaluation of these regulations.
“Rethink, take a second look at it,” Mr. Jinapor quoted the President as saying. “When Tema Oil Refinery takes the crude and they process and sell in Ghana cedis, why don't we pay Ghana cedi into that account and use our own cedi rather than going to the forex and buying dollars.” The Governor of the Bank of Ghana reportedly agreed with the President's reasoning, acknowledging the pressure dollar purchases place on the cedi. A meeting will be convened to structure a new payment mechanism.
The implications of this policy shift are substantial for Ghana’s economy. A successful transition to cedi payments for local crude could reduce the demand for US dollars by millions annually. This could lead to a more stable cedi, lower import costs for other goods, and improved national economic resilience. Decision-makers will closely monitor the Bank of Ghana’s proposed framework and the legislative adjustments required.
President Mahama also announced that TOR has received three separate one-million-barrel cargoes of crude oil since May. These deliveries included Bonga crude, Baleine crude, and Ghana’s Jubilee Medium Sweet crude. Two million barrels have already been processed into petroleum products, with payment for the Jubilee cargo completed.
The President further directed the Energy Minister to develop a strategic plan to increase TOR’s processing capacity to 100,000 barrels per day. This expansion aims to enhance Ghana's energy security and reduce reliance on imported refined products. The government also plans to restructure TOR to eliminate political interference, fostering more efficient operations.
The commissioning event marked the refurbishment of several key TOR facilities. These include the Crude Distillation Unit (CDU), the Residue Fluid Catalytic Cracking Unit (RFCC), a 120-ton steam boiler, and a new F-61 Crude Heater. These upgrades are crucial for improving the refinery's operational efficiency and output.
The progress at TOR, according to President Mahama, has been achieved without direct expenditure from the Government of Ghana. This suggests a focus on self-financing or alternative funding models for the refinery's revitalization. The move to cedi payments for crude oil is a significant step towards greater economic sovereignty and local currency utilization.