Gov’t to Diversify Oil Sector With $4B Refinery

Darkening economic clouds may soon hit Ghana’s Oil sector if plans to diversify her oil industry are not made quickly and properly.

According to the Minister of Energy, Mr Boakye Agyarko “We in Ghana are running short of petroleum products and it reflects in the instability of the demand and supply ratio.”

“Price keeps creeping up because we are not able to manage the supply side effectively,” he adds.

To avoid this throat-cutting misfortune, Ghana’s Energy Ministry has initiated an invigorating plan to establish a $4 Billion oil hub that would take care of the country’s refinery needs as well as storage, transportation and trading—all these happening within an enclave.

Mr Agyarko said, “government’s vision for the downstream is to make Ghana the hub for quality refined petroleum products in the West African sub-region through the expansion and improvement of existing infrastructure that ensures the delivery of competitively priced products and services in a secured, safe and environmentally friendly manner.”

Making the jaw-dropping revelation at this year’s Downstream Colloquium held in Accra, on Wednesday, he said the infrastructure would largely be export oriented.

The soon-to-be-built refinery is expected to replace TOR in three to four years with a production capacity of 150,000 barrels per day.

“The new TOR would ease out the old one which becomes a tank farm for the new TOR which is currently at 20,000 barrels a day,” the minister said.

Reformation of the Law Needed

For the goal of the Ministry of Energy (MoE) to be realised, a new legislation or the amendment of the current one must come to effect.

According to Mr Agyarko, the existing National Petroleum Authority (NPA) Act, 2005 (Act 691), does not take into consideration the transformation of the downstream petroleum sector into a hub in the West African sub region.

“A refined petroleum products hub shall involve the introduction of new players in the import and export sub sectors, infrastructure development and expansion (port facilities, barges, blending facilities, etc.), health, safety and security issues, and other activities that are not yet included in the current Act,” he noted.

The amendment process amongst others would focus on Licensing and Permitting Regime; Re-alignment of mandate of the Regulator; Construction and operation of downstream facilities; Health, Safety, Security and Environment (HSSE) standards and Tariffs and Charges for use of Downstream Petroleum infrastructure.

Don’t allow the laws tie us down

Meanwhile, the Senior Minister, Mr Osafo Marfo has charged policy makers to enact laws that are friendly in order to make implementation easy.

“Sometimes in this country, we tie our hands with our own legislation which makes it difficult for us to move. That is not the type of legislation we want.

“The idea is not to make the legislation such that people in operation find it difficult to move because they would need 30 approvals before they take one step. Legislation should not become bottlenecks for future operations of the industry,” he stressed.

Downstream Colloquium

The objective of the colloquium is to create a platform for the MoE, NPA and other stakeholders to dialogue and share information about the industry’s activities, policies and directions of the ministry.

It is also a time where trends and opportunities are unveiled to ensure the continuous growth of the petroleum downstream.

This year’s dialogue was anchored on the theme: “Ghana’s Petroleum Downstream – Then, Now and the Future.”

By: Grace Ablewor Sogbey/ [email protected]