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10.09.2009 Business & Finance

Government Moves To Settle TOR Debt

By Daily Graphic
Dr Oteng-Adjei second left, the Minister of Energy and other directors inspecting the plant at the refinery during a working visit.Dr Oteng-Adjei (second left), the Minister of Energy and other directors inspecting the plant at the refinery during a working visit.
10.09.2009 LISTEN

The government has appointed a transaction adviser to help raise funds to pay half of the $600 million owed the Ghana Commercial Bank (GCB) by the Tema Oil Refinery (TOR) to enable the bank to provide Letters of Credit for the purchase of crude oil for the refinery.

The Minister of Energy, Dr Joe Oteng-Adjei, who made this known, said the GCB had indicated its readiness to issue Letters of Credit for the importation of crude oil provided TOR could make a part payment of $300 million of its indebtedness to it.

He said this at a staff durbar yesterday when he visited the refinery to familiarise himself with its present state of operations.

He said the inability of the refinery to get crude oil was as a result of its indebtedness, adding that the refinery was indebted to the tune of GH¢1.2 billion.

Dr Oteng-Adjei said apart from owing the GCB, the refinery was indebted to bulk traders to the tune of $240 million. Among them are the Volta River Authority, Bulk Oil Storage and Transport (BOST) and the Electricity Company of Ghana.

He said the immediate priority now was to clear the balance sheet, since nobody or no bank would issue Letters of Credit if it saw it.

He said the refinery's debt was not the doing of the current government and asked the workers to bear with it as it took steps to get Letters of Credit to import crude oil soon.


On the TOR Recovery Levy, Dr Oteng-Adjei said the government had created a special account for the levy to enable a proper monitoring.

The levy was initially deposited in the Consolidated Fund, and this the minister said made it difficult to monitor how the account was used.

Dr Oteng-Adjei said aside TOR's debt, a lot of people were indebted to the refinery to the tune of GH¢311 million, describing it as unacceptable, especially when an entity owed the refinery GH¢104 billion.

In view of the refinery's indebtedness, he said, he had directed that allowances for Board of Directors be frozen till the financial status improved.


'We would not mind they taking T and T if they come for meeting,' he said, adding that TOR had been asked not to pay the former MD until things were positive.

He gave the assurance that the government would restructure TOR for the better, and that it would expand the refinery's current capacity of 45,000 barrels to 145,000.

Dr Oteng-Adjei warned that the government would not spare anyone, no matter the status, who tried to sabotage or thwart the efforts being made to improve the state of the refinery.

He said with agitation for wage increase in the face of overstaffing, the prudent thing to do was to cut down on the number of staff. He, however, asked the management and the union to work on how to address the issue.


Dr Oteng-Adjei commended the staff for their hard work that brought the premix crisis to an end. The acting Managing Director of TOR, Dr Kwame Ampofo, said the company had responsible workers and leadership, and that they would work with the government to improve its status.

He denied that the current board had approved new allowances for its members, stressing that the current allowances were the same as those paid to the previous board about three years ago.

The Chairman of the TOR Workers Union, Mr Albert Pinto, said TOR workers were hardworking and that once crude oil was provided, the refinery would be able to pay its debt.

He blamed politicians for the current state of affairs of the refinery, pointing out that the refinery was a viable entity that needed to be supported to enable it to deliver.

Author: Emmanuel Bonney

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