26.2 C

Tema Oil Refinery Needs Private Partnership To Survive – John Mahama

Mahama criticized TOR for being inefficient, attributing its issues to poor management commonly found in state-owned entities.

The former president and flagbearer of the National Democratic Congress (NDC) John Mahama said if elected into power again there will be technical and commercial audit for a possible strategic and private partner to turn around the fortunes of the struggling Tema Oil Refinery (TOR).

The national asset TOR has been in the news for years over its inability to operate in its capacity.

John Mahama said this in a meeting with players in the petroleum downstream sector as part of his building Ghana tour on Tuesday, May 21 2024.

- Advertisement -

“We think that we must initiate a technical and commercial audit of Tema Oil Refinery,” he said.

Join our WhatsApp Channel for more news

The NDC flagbearer stated that during their time in office, they restarted the refinery and successfully produced the first batch of locally produced oil. He mentioned that this achievement occurred near the end of their term, but unfortunately, after they left office, the refinery broke down again.

“When we came into office, we put the refinery back to work. It hadn’t been working and it started operating. Our confidence was high. The first parcel of our own locally produced oil to the Tema Oil Refinery. Unfortunately, it was at the tail end when we were leaving the office. My understanding is that the parcel sat there for several years because the refinery had broken down again, and eventually it was disposed off at a discount,” he said.

- Advertisement -

Mahama criticized TOR for being inefficient, attributing its issues to poor management commonly found in state-owned entities.

“We need to look again into how we can bring the refinery back in place. But I do think that the problem we have with running that refinery is because it is a state-owned enterprise. We all know the inefficiencies that go with state-owned enterprises,” he said.

Mahama suggested that the solution to TOR’s problems is establishing a transparent private partnership that implements the best processes.

“We are open to private partnership in terms of bringing it back into operation and running it. But we think that whatever private partnership or operation is invited it must come through a transparent process that allows the best process to be procured,” he said.

The Tema Oil Refinery, originally named the Ghanaian Italian Petroleum Company (GHAIP), was established in 1960 as a private Italian company.

Major shareholders included ANIC Societa per Azioni and AGIP Societa per Azioni.

In 1977, the Government of Ghana took over as the sole shareholder and renamed it the Tema Oil Refinery in 1991.

Authorized to refine crude oil and sell petroleum products, TOR faced a significant debt due to government subsidies on petroleum products, which the Government of Ghana paid off in 2010, amounting to 1 billion cedis owed to Ghana Commercial Bank.

While you're here, we just want to remind you of our commitment to telling the stories that matter the most.Our commitment is to our readers first before anything else.

Our Picks



Get the Stories Right in Your Inbox