CBOD advocates for fair competition in Ghana’s downstream petroleum sector
The Ghana Chamber of Bulk Oil Distributors (CBOD) has clarified its stance on the government’s gold for oil programme and the involvement of the Bulk Oil Storage and Transportation Company (BOST) in managing strategic petroleum stocks within the downstream petroleum sector. While the CBOD is not opposed to these initiatives, it is advocating for a level playing field where BOST does not receive preferential treatment that gives them an unfair advantage over other bulk distribution companies.
In an interview, Dr. Patrick Ofori, the Chief Executive Officer of CBOD, emphasized the need for an enabling environment that allows fair competition based on individual companies’ strengths. He expressed concerns about the skewing of laycans (the schedule for berthing petroleum-carrying vessels at the ports) in favor of BOST, as well as the allocation of foreign exchange, which could potentially distort the markets and impose a financial burden on an already stressed economy.
Dr. Ofori highlighted the importance of BOST competing within the commercial space of product importation based on the strength of its balance sheet. He urged BOST to raise letters of credit and attract international oil trading companies on their own merit, rather than relying on state entities for protection and claiming efficiency based on state support.
The CBOD CEO cautioned against the central bank underwriting the risks associated with BOST’s commercial activities. He referred to past experiences where the Ghana National Petroleum Corporation (GNPC) was brought in to support BOST, which did not end well. He also raised concerns about product accountability and transmission losses associated with BOST facilities, as reported by some bulk distribution companies and inspection companies.
CBOD’s main objective is to ensure a level playing field that promotes sustainability and profitability in the downstream petroleum sector while safeguarding Ghana’s energy efficiency and security. Dr. Ofori emphasized that the chamber is not against the gold for oil programme or BOST’s mandate but seeks fair competition and equitable treatment for all industry players. He pointed out the disparities in licensing fees and levies paid by CBOD members compared to BOST, along with the lack of benefits derived from the BOST margin.
CBOD is advocating for fairness, transparency, and equal opportunities in the downstream petroleum sector, where private sector entities are not unduly bullied or discriminated against. The chamber’s concerns reflect a desire for a sustainable and thriving industry that contributes to Ghana’s overall economic development.
