Benjamin Nsiah, Executive Director of the Centre for Environmental Management and Sustainable Energy, has called for changes to Ghana's Petroleum Act. He believes the law should ensure the Tema Oil Refinery (TOR) consistently gets crude oil from Ghana's own production. This would help revive the refinery and strengthen the nation's ability to process its own oil.
Nsiah argues that without this policy shift, TOR's attempts to restart and operate fully will be difficult. He noted that TOR's financial situation makes it hard to buy large amounts of crude oil from elsewhere. The refinery may struggle to secure enough oil from the West African region. Global energy and shipping costs are also rising.
Crude oil from the Middle East might be cheaper in price. However, transport and insurance costs can make it very expensive, Nsiah explained. These comments come as TOR tries to get back on track after years of problems. The refinery has stopped working many times due to not having enough crude oil. Old equipment and large debts have also forced production cuts.
TOR is now looking more at West African crude oil to improve its operations. Managing Director Edmond Kombat stated that talks are happening about changing how Ghana distributes its crude oil. This aims to ensure a steady supply of oil for TOR. He said this is part of efforts to improve the refinery after financial and operational troubles. Global oil market swings due to political issues also cause problems. Higher shipping costs also increase import expenses.
Despite these issues, TOR management remains focused on stability and better performance. This is to secure the refinery's future. The refinery has faced shutdowns due to crude oil shortages and aging infrastructure.
Data shows TOR has been struggling with debt. Figures suggest the new management inherited around GHS 517 million in debt. This massive debt load puts a strain on its ability to secure financing for operations. The refinery's struggle is a key indicator of challenges faced by state-owned enterprises (SOEs) in Ghana. Many SOEs have historically faced funding issues and operational inefficiencies. The government has recognized the need to improve financial management and operational efficiency in these entities.
Securing a stable supply of crude oil, preferably from local sources, is crucial for TOR's long-term viability. This would reduce reliance on volatile international markets and potentially lower operational costs. The success of these reforms is critical for Ghana's energy security and economic development.