A former Chief Executive Officer of the National Petroleum Authority (NPA), Alex Kofi Mould, is advocating for a restructuring of Ghana’s petroleum downstream sector in a manner which will lead to a drastic reduction in the number of oil marketing companies and bulk oil distribution companies.
Data sourced from the NPA’s website indicates that as of August 2022, there were about 235 oil marketing companies and 48 bulk oil import distribution and export companies.
In the view of Mr Mould, the number of OMCs and BDCs operating in the downstream petroleum sector are too many, hence, the need to downsize them.
Suggesting what should be done to restructure the sector to address the current forex losses by OMCs and BDCs which is making some of the companies struggle to remain in business, Mr Mould said, “We need to limit the number of BDCs and OMCs operating via a volume-limit mechanism.”
Explaining what he meant by volume mechanism, he said the BDCs and OMCs should be given the number of volumes of oil they have to import or supply to the market.
He said any OMC that has had a licence for the last five years, but has not hit the agreed threshold of, for example, 200 million litres of fuel sales should be shut down or its licence not renewed.
Again, he said any BDC that does not meet the agreed threshold of, for example, 500 million litres within five years of receiving its licence should be shut down.
Per data available on the NPA’s website, only Goenergy Company Limited, Juwel Energy Ltd and Blue Ocean Investments Ltd supplied about 500 million litres of fuel.
For the companies that supplied between 250 million litres and 500 million litres, the data showed Marathon Oil Services Ltd, Dominion Int. Petroleum Ltd, Chase Pet. Ghana Ltd, Astra Oil Services Ltd, Fueltrade Ltd.
The remaining 48 BDCs supplied below 200 million litres.
Source: https://energynewsafrica.com