Government urged to address crude oil problem
Posted on: 2011-Nov-23        Daily Graphic
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Stakeholders in the petroleum industry have called on the government to address the inconsistent supply of crude oil to the Tema Oil Refinery (TOR) to avoid the recurrence of severe shortage of Liquefied Petroleum Gas (LPG).

The appeal comes on the heels of the shutdown of the refinery’s two major plants the Crude Distillation Unit (CDU) and the Residual Fluid Catalytic Cracker (RFCC) plants on November 5 and 9, respectively for non availability of crude oil for production.

Subsequently, production has come to a halt as the refinery's management engages a consor-tium of banks in negotiation for letters of credit (LCs) to enable officials to take delivery of some one million barrels of crude oil on board the company's time chartered vessel, Nippon Princess, on anchorage at the Tema Harbour.

Similarly, TOR is unable to process some 150,000 barrels of crude oil being stored in its storage facilities as a result of its inability to raise the LCs for Sahara Oil, the consignee agency.

According to the General Secretary of the General Transport, Petroleum and Chemical Workers Union (GTPCWU), Mr Emmanuel Armstrong Mensah, the government’s attempts to recapitalise TOR must include the supply of crude from the Jubilee oil fields to keep it in business.

He told the Daily Graphic that TOR’s strategic role in the country's economy could not be underestimated thus the need for the government to take a serious look at the challenges since it could have dire consequences for the development of the petrochemical industry.

He explained that the continual inactivity at the refinery's plants would create a big problem for the country, as there might be lack of basic by products such as naptha or industries and the depressing effect would be there for all to see.

He said the government should be able to go beyond the lip service to action since the TOR was a 100 per cent state owned enterprise (SOE).

“If the refinery’s machinery remained grounded, its components become mal functional and we may end up going the Nigeria way where they produce raw crude but go out to refine it”, he lamented.

Mr Mensah also expressed disappointment at the sluggish progress on the recommendations from many meetings held between the leadership of the union, the TOR and the government and urged the latter as a matter of urgency, help the refinery in the raising of LCs for crude oil procurement.

“Petroleum subsidies, which in the past plunged the TOR into huge fiscal crisis, were never the making of the refinery since those benefits went to the consuming public, and if those actions today are preventing the TOR from raising LCs, the government ought to come to its aid”, he stated.