The Management of Ghana’s only oil refinery, Tema Oil Refinery (TOR), has rejected the assertion by the staff of the refinery that its Board of Directors are incompetent.
A release issued and signed by TOR’s Corporate Affairs Manager, Dr. Antwi-Boasiako, on November, 5, 2020, said the unions’ allegation was based on the Board’s decision to defer the Collective Bargaining Agreement (CBA) negotiation to 2021, due to the harsh economic impact of COVID-19 on TOR’s finances in 2020.
He explained that the unions and Management of TOR meet every three years to negotiate a Collective Bargaining agreement that sets out salary and benefits for the next year, which they had to defer to 2021 because of the devastating impact of Covid-19 on TOR’s operations for 2020.
Touching on progress made by the current management to dispel the incompetence tag, the management observed that efforts by the current Board has led to the payment of TOR’s outstanding GHc1 billion debts accrued between 2009 and 2016.
The payment was made by the current Nana Akufo-Addo-government as part of support to TOR.
The release noted that a further US$67 million of the debt carried over from 2009 to 2016 has also been paid by the government.
It stressed that the Board and Management of TOR continued their efforts to clear the debts that were left, adding that under the leadership of the current Board, TOR has been able to successfully carry out its long overdue shutdown maintenance, improved the efficiency and availability of the processing plants, reduce losses, improvement in product yields and financial performance.
The management said this is evidenced by the recent continuous processing of up to eight million barrels of crude oil at the refinery since September 2019.
The management also wondered why under the current Board, TOR has seen more operational days than 2009-2016, and has engaged with oil traders such as Woodfields, leading to the signing of a processing agreement for the company to process crude oil/feedstock compared to process 11 million barrels of crude oil on their behalf since September 2019 to date, yet the unions want to describe them as incompetent.
“Thus, the current management has demonstrated the capacity and also ensured that TOR has had consistent supply of crude/feedstock for processing as compared to previous years, making the unions concerns unfounded.”
The statement further affirmed that under the current Board of TOR, a new furnace has been procured to replace the exploded one.
It was of the view that the current Board has set out to immediately ensure that the auditing of financial accounts that had been neglected from 2013 to 2016 were carried out as a matter of urgency, adding, “We can report now that auditing of 2013 to 2016 financial accounts have now been completed, with 2016 being the worst performing year which recorded a loss of approximately GHS 866 million.”
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The management of TOR also said, in consultation with the union Executive, set up a taskforce to implement the recommendations from the Committee’s reports the unions referred to in their statement.
The taskforce’s activities, the statement explained, are ongoing.
In the light of cash flow and other financial challenges that TOR has been facing, the company commenced the development of a Profitability Improvement Plan in May 2020. Objective of the plan is to revitalize TOR by setting out a clear path that would ensure that TOR is able to operate as a viable going concern and meet its payment obligations, while effectively carrying out its core business activities.
It concluded that plan focuses on three key areas: revenue generation, cost reduction and loss elimination, adding that Covid-19 pandemic has had a profound impact on the global refinery industry and TOR has not been spared either.
According to the TOR’s management, for unions to allege that the Board has made no significant contribution to the company is unsubstantiated and unfortunate because, “TOR as at January 2017, the financial account had not been audited since 2013. In addition, TOR has outstanding debts of around US$345 million and also about GHc1.05 billion owed to third parties, traders and financial institutions,” the management explained.
Source www.energynewsafrica.com