‘Dumsor’ costs OMCs Ghc33m

Oil Marketing Companies (OMCs) in Ghana spend as much as GH?33 million on the average every month on fuel to power generators at various fuel dispensing (filling) stations across the country due to the rolling power cuts, popularly called dumsor.

This has resulted in huge cost overruns, which is threatening the survival of the OMCs and stalling expansion plans.

Chief Executive Officer of the Association of Oil Marketing Companies of Ghana (AOMCS), Mr Kwaku Agyemang-Duah, who disclosed this to The Finder in an interview in Accra, expressed worry that if dumsor is not solved soon, it could force some filling stations out of business during power cuts and interrupt fuel supply.

He explained that before dumsor, OMCs were spending about GH?320 a month on fuel to power their generators at each filling station. However, he said since the onset of dumsor, the OMCs now spend a whopping GH?10,000 on fuel a month on the average to power the generators of each filling station.

With 3,300 filling stations nationwide, spending an average of GH?10,000 on fuel for each station a month translates into averagely GH?33 million per month, he stated.

Mr Agyemang-Duah noted that the cost of maintenance of the generators has also risen astronomically because of the long hours of power cuts.

He regretted that the GH?33 million that OMCs are spending on fuel due to dumsor could have been spent on expansion to employ more people, used to pay taxes to the state, as well as used to undertake corporate social responsibility programmes to benefit communities. He added that the country consumes 35 million litres of petrol a week and 45 million litres of diesel a week.

Mr Agyemang-Duah explained that the margin for OMCs is 6% of ex-pump price.

Considering the fact that the margin is small, he said OMCs need large volumes to remain in business.

According to him, anytime Bulk Oil Distribution Companies (BDCs) experience a drop in their imports, OMCs are affected.

Mr Agyemang-Duah, therefore, appealed to government to sort out all foreign exchange losses issues to ensure that BDCs continue to import large volumes to keep the OMCs in business.