TOR Crisis: Government Intervenes

A four-man team comprising the Chief of Staff, two ministers and the Governor of the Bank of Ghana, has been set up to rescue the Tema Oil Refinery (TOR) from its huge indebtedness and ensure regular supply of crude to the refinery.Mr John Martey Newman, the Chief of Staff, and Dr Paul Acquah, the central bank governor, would work with Dr Kwabena Duffuor, the Minister of Finance and Economic Planning, and the Energy Minister, Dr Joe Oteng-Adjei, in restoring the balance sheet of TOR in order to reduce its huge debt, as well as managing its crude oil supply.Over the past four month, TOR has been facing some serious challenges with respect to financial capacity and procurement of crude oil in addition to internal agitation from its work force. Speaking to the Daily Graphic, the acting Chief Executive of TOR, Dr Kwame Ampofo admitted that the refinery was indebted to the Ghana Commercial Bank (GCB) alone to the tune of GH¢900 million, rendering it impossible now for the refinery to establish new letters of credit to procure crude oil.The Chief Executive was reacting to concerns raised by some TOR workers about management’s inability to import crude oil since the beginning for the year, thus allowing major suppliers to procure finished products at exorbitant prices for the refinery. He said the debt portfolio, which some financial analysts said could cripple the largest commercial bank in the country, was the main challenge confronting the company.And to address the urgency of the situation, the Minister of Energy, Dr Joe Oteng-Adjei, told the Daily Graphic that ht presidential team, set up two weeks ago to salvage TOR form its predicament, had held talks with officials of TOR and GCB to discuss how the refinery could clear its indebtedness to GCB without derailing its (TOR’s) normal function.He said with respect to the financial challenge, the team was holding discussions with two banks, whose names he preferred keeping close to his chest, “because when you are in the process of negotiation, you don’t want to mention names.”On the regular supply of crude oil for TOR, Dr Oteng-Adjei said for now the team had three main options, namely, Nigeria, Libya and Venezuela, from where the product could be sourced. He said the idea was to ensure that if one of them was unable to supply crude oil to TOR, the refinery could always fall on the others for supply, thereby reducing the probability of non-availability of crude oil.
Source:Daily Graphic