NPA Boss urges LPG marketing companies to embrace CRM

The Chief Executive of the National Petroleum Authority (NPA), Dr. Mustapha Abdul-Hamid has urged LPG marketing companies to reassess their opposition to the cylinder recirculation model (CRM) and embrace the policy.

He said CRM was being implemented in all the countries in the West African sub region, including Cote d'Ivoire, Togo, Burkina Faso and Senegal, and indicated that Ghana could not afford to continue to lag behind.

Speaking at the opening of the 2024 Ghana International Petroleum Conference (GhIPCon) in Accra on Wednesday, the NPA Boss said he had noticed the aggressive advertisements run by LPG marketing companies (LPGMCs) promoting the current LPG filling station concept.

He acknowledged that it may be within the rights of the LPGMCs to run the advertisements but urged the companies to adjust and accept the change since it would ensure safety and convenience in the distribution and use of LPG in the country.

"I urge you to reassess your opposition to the CRM policy because all across the world, very few countries still adopt the filling station concept as far as LPG distribution is concerned. All across the West African sub region Cote d"Ivoire, Burkina Faso, Senegal, Togo, everywhere else people are running the CRM model.

" I don't think Ghana can afford to continue to lag behind. I think that it is important that we catch up with the modern trends and to adopt to the flow", he stressed.

Dr. Abddul-Hamid said CRM had the potential to create more jobs along the value change.

He mentioned the operations of LPG bottling plants, depots, exchange points, and transportation of filled cylinders as some of the job opportunities in the CRM value chain.

The two-day conference organized by the NPA in collaboration with the Chamber of Bulk Oil Distributors (CBOD), the Association of Oil Marketing Companies (AOMC)and the Ministry of Energy was held on the theme: "‘The Petroleum Downstream: Building a Future for Growth, Efficiency, and Sustainability’.

This year's GHIPCON, the sixth in the series, has the overall objective of addressing critical issues and exploring opportunities within the petroleum downstream sector.

Dr. Abdul-Hamid said that over the years, the petroleum downstream industry had evolved into a vibrant and dynamic industry with increased private sector participation.

"It has become a key contributor to the growth and development of the economy, we estimate that the sector had a monetary value of over GHS71 billion, representing about 8.4% of the country's 2023 GDP.

"Over the past seven years, the industry returned an average annual value of over GHS35 billion," he said.

The NPA Boss said as a result of improvements in the performance of the economy driven by deliberate government policy initiatives aimed at expanding the productive sectors of the economy, Ghana"s neighbouring countries such as Mali, Niger, Cote D’Ivoire, Togo and Burkina Faso had been importing petroleum products from the country"s petroleum downstream industry.

He said the volumes of petroleum products re-exported and transited to the neighbouring countries totalled 385,154,100 litres in 2023.

Dr. Abdul-Hamid said the increase in volumes of the exports was a testament of significant successes in the NPA’s efforts towards curbing illicit fuel activities in the country.

He indicated that the Authority has intensified its collaboration with the navy, marine police and immigration to continue to arrest people engaged in illicit activities.

He announced that Senegal and Gambia had also begun the importation of petroleum products from Ghana.

The Vice President, Dr. Mahamudu Bawumia, in a speech read on his behalf by the Minister of State at the Ministry of Energy, Mr. Herbert Krapa noted that since the last GhIPCon in 2022, Ghana has made significant progress towards an efficient and sustainable energy industry.

He said the government had introduced and implemented the Gold for Oil Programme, which had reduced the demand on forex reserves required for the importation of petroleum products, increased local product supply volumes, and reduced premiums from significantly, resulting in a relative reduction in the prices of petroleum products.

Besides, the Vice President said the Board of the Petroleum Hub Development Corporation had been sworn in, and a $12 billion Agreement with TCP-UIC Consortium had been signed for the development of the first phase of the Petroleum Hub project at Jomoro, in the Western Region.

He said the country had also seen the nation’s accessibility to LPG increase from 25% in 2020 to 40% at the end of 2023, and through this period, government launched the National LPG Promotion Programme with LPG cookstoves and related accessories being distributed to first-time users.

In their remarks, the CEO of the Chamber of Bulk Oil Distributors, Dr. Patrick Ofori, and the CEO of the Association of Oil Marketing Companies, Dr. Riverson Oppong affirmed their commitment to collaborate with the NPA to promote the growth and sustainability of the petroleum downstream industry.

Source: National Petroleum Authority