The Institute for Energy Policies and Research (INSTEPR) has highlighted a number of problems currently facing State-owned oil refinery, Tema Oil Refinery (TOR) which needs fixing to enable the refinery to become fully functional.
The energy think tank in a press release averred there are no quick fixes to the myriad of problems facing TOR noting that government needs to give special attention to the refinery to ensure its long-term viability.
According to INSTEPR, the five problems that need fixing at TOR include;
- Fixing the CDU from the 23,000 barrel per stream day (bpsd) to 45,000 barrel per stream day (bpsd)
- Solving the Residue Fluid Catalytic Cracker (RFCC) problem
- Installing hydrotreating catalysts and technologies for all crude oil fractions, enabling the refinery to meet 50 ppm or lower specification.
- Constructing a gas pipeline (less than 1KM) to power the refinery. This stops the refinery from using expensive Crude oil for power.
- Putting measures and security in place to stop the theft of products.
Meanwhile, the energy think tank has bemoaned the resignation of the Managing Director of TOR, Francis Boateng as well as his deputy, Ato Morrison who were appointed to head the refinery just 14 months ago.
INSTEPR also expressed dissatisfaction with current happenings at the refinery which the institute says it has been monitoring with grave concern as the refinery in recent weeks has been in the news for all the wrong reasons.
The institute cited worker’s agitation over nonpayment of salaries, water supply to the refinery being disconnected by the Ghana Water Company Limited, unavailability of crude oil to be refined at the Refinery among others as being issues about the refinery that made headlines in the country and which it considers as unfortunate.
Read details of press release below:
CAN TEMA OIL REFINERY (TOR) WORK AGAIN?
The Institute for Energy Policies and Research (INSTEPR) has learnt of the exit of the Managing Director, Mr. Francis Boateng and the Deputy Managing Director, Mr. Ato Morrison who were appointed to head Tema Oil Refinery (TOR), fourteen (14) months ago. In recent weeks our beloved Tema Oil Refinery has been in the news for all the wrong reasons. The refinery is a 45,000 barrel per stream day (bpsd) capacity Crude Distillation Unit and 14,000 bpsd Residue Fluid Catalytic Cracker (RFCC) Unit which converts atmospheric air to higher value finished products.
The Institute has been monitoring current happenings at the refinery with grave concern. We have stated in the past that the Refinery needs special attention by government to determine the long-term viability of the Company. Worker’s agitation over nonpayment of salaries, water supply to the Refinery being disconnected by Ghana Water Company Limited, unavailability of crude oil to be refined at the Refinery, to mention a few are the recent headlines in the country.
There is no quick fix to the myriads of problems at TOR. Some people are of the belief that if GNPC gives our local crude oil to TOR and Ministry of Finance gives money to the refinery to pay 6months of salaries the problems will disappear.Unfortunately, that is a misconception. All refining done by TOR in the last 6 years using the CDU and RFCC has resulted in losses to the Refinery.
The following, to mention a few, needs to be addressed at TOR to give the company any chance of survival:
- Fix the CDU from the 23,000 bpsd to 45,000 bpsd
- Solve the RFCC problem
- Install hydrotreating catalysts and technologies for all crude oil fractions, enabling the refinery to meet 50 ppm or lower specification.
- Construct a gas pipeline (less than 1KM) to power the refinery. This stops the refinery from using expensive Crude oil for power.
- Put measures and security in place to stop the theft of products.
The tolling business model which was started by Mr. Isaac Osei with Woodfields had sustained the refinery with cashflow until the contract was frustrated and ultimately not renewed by the outgoing Managing Director, without any substitute arrangement.
In February 2020, INSTEPR interviewed the then Managing Director, Mr. Asante Berko, who outlined his vision for the refinery and strongly believed that a sound financial modelling and restructuring the business of TOR will turn the fortunes of the refinery. The institute shared in his vision to revamp TOR and judging by what he had done the few months he was at post, we felt it was unfortunate he resigned in April 2020.
The government is faced with the daunting task of appointing a new Managing Director and a board of Directors to save our premier and only Refinery. The Minister of Energy is appointing an interim management committee to oversee the day to day running of the refinery. We hope this decision is not rushed since the job security of many workers employed at TOR depends on a new competent Managing Director.
Kwadwo N. Poku
Executive Director
