TOR RESUMES PRODUCTION

THE Tema Oil Refinery (TOR) is set to restart its plant for production Wednesday after a four-week period of inactivity at its production lines.

This follows the successful discharge of some 600,000 barrels of crude from the Nippon Princess vessel that had been in dock at the Tema Port for the past five weeks.

The delivery of the consignment valued at $54 million was facilitated by the Bank of Ghana (BoG) who gave TOR a waiver on its Single Obligon Limit (SOL) regulation that restricts one commercial bank from granting loans of more than GH¢16 million to TOR.

Until the approval, TOR was finding it difficult to raise letters of credit (LCs) to cover the cost of the consignment which was procured from Nigeria through an open market arrangement by the refinery’s management.

The production of the consignment would, however, last three weeks, and this workers fear may result in another shut down should government fail to guarantee an alternative arrangement to ensure frequent procurement of crude oil.

An official source at the refinery told the Daily Graphic that the Crude Distillation (CDU) plant was expected to resume production of the crude oil tomorrow, whereas the restart of the Residual Crude Catalytic Cracker (RFCC) would be delayed to allow the CDU generate enough stock of atmospheric residue (AR) which was the RFCC’s major raw material processed into Liquefied Petroluem Gas (LPG), gasoline, crack residue fuel for industries as well as light and heavy cycle oil among other products.

The shut down of the RFCC and CDU which were carried out on June 30 and July 25, 2011 respectively was as a result TOR’s inability to establish letters of credit (LCs) from its bankers to purchase crude oil for production.

Meanwhile workers have expressed worry at government’s inability to ensure TOR had access to crude oil from the Jubilee fields for production.

Daily Graphic's sources at the refinery said, TOR's management at the commencement of production at the Jubilee fields intensified efforts to secure crude oil from the field to process.

According to the source, TOR secured letters of credit (LCs) to enable Vitol Plc deliver some 450,000 barrels of the jubilee crude to the refinery.

The deal they said was however
cancelled by officials of the Ministry of Energy for no just reason.

The Energy Minister, Dr Joe Oteng-Adjei who described the allegations as mere speculations told the Daily Graphic that the issue was a technical one that the ministry may not want to meddle into.

According to him, for TOR to procure crude from the jubilee fields, it needed to satisfy a commercial requirement, thus the ministry would not allow itself to be drawn in such arguments.

"If TOR or any other entity has the ability to procure, they should engage the Ghana National Petroleum Corporation," he said.

He indicated that the selling of the crude oil on the international market was based on economic values in the petroleum agreement meant to ensure Ghana maximises enough benefit from the production.

"Unless there is a world shortage of crude oil and there is no where TOR can get crude, then as a country we can make a decision that it makes no sense to sell the jubilee crude," Dr Oteng-Adjei stated.

Expatiating, he said the issue to procure the jubilee crude was one that the refinery's management ought to address with GNPC, as government in its efforts to ensure TOR's profitability had eliminated the huge indebtedness that had over the years posed a major challenge that impeded the company's growth.

"If TOR looks at the prices the country is getting for the jubilee crude coupled with their technical requirement and feels they have the capacity to buy and would be able to provide the necessary financial guarantees, then we at the ministry have no problem," he explained.


Source: Della Russel Ocloo, Daily Graphic, Aug 9, 2011.