TOR needs US$67 million to enhance operations

Petroleum Minister Emmanuel Armah Kofi Buah has said that more than US$67 million would be needed for the Tema Oil Refinery’s (TOR) plant stabilization and profitability enhancement project.

He repeated earlier assurances that the refinery was not for sale, but was being rehabilitated to run an optimal level to enable it secure consistent supply of crude oil.

“The Ministry of Petroleum (MoP) is committed to ensuring that TOR operates efficiently with consistent supply of crude oil,” he told Parliament of Wednesday, when he answered questions on the floor of the House.

His assurance was in response to a question by Daniel Nii Kwartei Titus Glover, Member of Parliament for Tema East, who wanted to know what effort the Ministry was making to assist TOR procure crude oil to refine.

According to the Minister, the Ministry in 2011 conducted a comprehensive audit of TOR, which identified the refinery’s challenges as being mainly technical and commercial.

The audit concluded that the TOR needed a capital injection for the Stabilization and Enhancement Project on the Crude Distillation Unit and Residual Fluid Catalytic Cracking Units to enable the oil refinery firm procure and refine crude oil.

When quizzed by the MP for Mampong, Francis Addai-Nimoh, whether TOR in its current state could refine oil, the Petroleum Minister said “just two months ago, TOR received 2,000 tons of crude which they have processed”.

TOR’s operations until January 2015 stalled for some time due to its operational inefficiency and the inability to establish letter of credit for purchase of crude oil. Its Crude Distillation Unit (CDU) was shut down in the process with Junior Staff of the company calling on President John Mahama to help save the company which was running on daily loses of GH?350,000.

In November, 2014, then deputy Minister for Energy and Petroleum, John Jinapor, announced that the Government was in talks with Petro Saudi in a joint-venture arrangement to revive the ailing oil refinery.

The agreement when reached would see the Arabian Firm plug the inefficiencies that has engulfed TOR.

Per the agreement, a new marketing firm called TOR-PS (TOR-Petro Saudi) would be set up to procure crude oil and sell the finished product. Petro-Saudi is expected to control 49 per cent of the stakes while Ghana manages the remaining 51per cent.

Mr Buah said after the audit, the TOR submitted a comprehensive action plan, and the MoPt facilitated the release of the first tranche of US$ 30 million from the Ministry of Finance to initiate the implementation of the enhancement project.