Finance Ministry to write off about US$120m of TOR’s legacy debt

The Ministry of Finance is expected to write off about US$120 million of the Tema Oil Refinery’s (TOR) legacy debt as part of efforts to ease the financial burden on the state-owned refinery.

TOR Managing Director, Edmond Kombat, disclosed this during a working visit by Parliament’s Energy Committee.

According to Mr Kombat, the refinery’s legacy obligations currently stand at about US$400 million following an earlier debt restructuring exercise.

“We do have legacy debts on our books. When we did the restructuring, the first phase brought it down to about $400-and-something million,” he explained.

He said the Ministry of Finance planned to include the proposed write-off in the 2026 budget, which would further reduce the refinery’s outstanding liabilities.

“Currently, the Ministry of Finance is saying they are going to write off some of the debts owed to them. I think they are including it in this year’s budget. It’s about $120 million. So if that is taken out, it will also further bring the debt down,” he said.

Mr Kombat, however, noted that TOR continued to owe substantial amounts to both private companies and state institutions.

He mentioned Sahara and BP among the refinery’s private creditors, saying management was negotiating with them to explore possible discounts on the outstanding amounts.

“We also owe GNPC and VRA. Because they are state institutions, we will need your help as the Parliamentary Select Committee to help net it off,” he told the committee.

He therefore appealed to Parliament’s Energy Committee to support efforts to resolve TOR’s outstanding obligations to the Ghana National Petroleum Corporation (GNPC) and the Volta River Authority (VRA), while management continues negotiations with its private creditors.