The Managing Director of the Tema Oil Refinery (TOR), Edmund Kombat, has attributed the refinery's turnaround to efforts to restore the confidence of Bulk Distribution Companies (BDCs). BDCs had stopped storing petroleum products at TOR due to concerns about receiving their full quantities. Mr. Kombat said rebuilding this confidence was crucial to turning around the loss-making refinery and restoring its revenue generation.
When Mr. Kombat took over, there was widespread mistrust of TOR's storage and transfer systems. He said people didn't trust TOR, and there was a lot of mistrust for the refinery and the storage because at the time, people were bringing petroleum products, and then they got missing. As a result, BDCs stopped bringing petroleum products to TOR. Mr. Kombat personally engaged BDCs, Oil Marketing Companies (OMCs), and companies from neighboring countries, assuring them that their products would be fully accounted for.
The first BDCs that returned to TOR received their products in full, helping to rebuild confidence and creating a surge in demand for storage space. This return of BDCs to TOR provided the refinery with an important source of revenue through storage charges, product transfers, and rack operations. The funds generated were used to address some of TOR's pressing operational challenges, including turnaround maintenance on the Crude Distillation Unit (CDU).
The management also used the available funds to settle outstanding obligations to former employees. A lot of staff who had retired and needed terminal benefits were not paid, so they had to make sure that all those people were paid. There were others who resigned and were not paid, and they had to make sure that they were paid. This helped to resolve some of the long-standing issues at TOR.
Mr. Kombat stressed that the turnaround of TOR was still ongoing, with further work expected to sustain the refinery's recovery. He emphasized that rebuilding trust with stakeholders was a continuous process and that TOR was committed to maintaining this trust. The refinery's revival is crucial to Ghana's petroleum industry and the country's economy.
The Tema Oil Refinery has been facing several challenges, including a $400 million legacy debt. The Finance Ministry has plans to write off $120 million of this debt. The refinery's operations have also been impacted by the supply of local crude oil. The Minority has called on the government to sustain the local crude supply to TOR to ensure its continuous operation.
The revival of TOR is part of Ghana's dream of becoming a petroleum hub. The Institute for Energy Security (IES) has called for the enforcement of Ghana's Domestic Market Obligation as TOR resumes operations. The refinery's strategic collaboration with other industry players, such as GOIL and Sentuo Refinery, is expected to enhance its operations and contribution to the country's petroleum industry.
Key points
- Rebuilding trust with Bulk Distribution Companies was key to TOR's turnaround.
- TOR's revival is crucial to Ghana's petroleum industry and economy.
- The refinery still faces challenges, including a $400 million legacy debt.
