TOR incurs US$168 million debt

Accra, Nov. 13, GNA - Mr John Attafuah, Chief Executive Officer of the National Petroleum Authority (NPA), on Thursday said the Tema Oil Refinery (TOR) incurred a debt of US$168.147 million due to recent hikes in world

crude oil prices.

He told journalists at a press conference that as a result of the TOR debt fuel prices could not go down further than 10 per cent following the recent fall in the world prices from US$147 per barrel to the current US$58.

"In our estimation, we should have reduced fuel prices by 17 per cent following the fall in the world prices, but we need to recoup some of the money to cover the TOR debt," he said.

Mr Attafuah explained that when world prices reached US$116 per barrel in May, President John Agyekum Kufuor intervened and cut taxes on petroleum products to ameliorate the burden on the motoring public. He said after that period world prices continued to soar until it reached US$147 in July, while the public continued to buy fuel at the price based on US$116 between May and Sept 2008.

"Within that period we should have increased petrol prices to GHC 6.00 per gallon and diesel to GHC 6.50 per gallon but we kept it low while the cedi-dollar exchange rate also rose in favour of the dollar leading to debt," he said.

Over the period, the cedi-dollar exchange rate moved from GHC 0.9848 to the dollar, to GHc1.162 to the dollar. Mr Attafuah noted that the debt incurred had to be paid, either from the national budget or through the pricing mechanism being employed by the NPA.

"The NPA Act, Act 691, enjoins the Authority to protect the interest of both the consumers and the petroleum service providers. "While we expect consumers to benefit from price reductions on the world market, it is also important for us to ensure that petroleum service providers do not suffer unduly." He, however, noted that even though fuel prices had been reduced by 10 per cent, transport operators continued to charge the old fares. Mr Attafauh therefore appealed to transport operators to adhere to the new fares published in the newspapers and pass on some of the benefits from the reduction to consumers. He assured the public that NPA would continue with its fortnightly review of fuel prices and as and when there was any reduction it would ensure that the public benefited.