By: Benjamin Nsiah
Ghana’s petroleum downstream has about 5000 Bulk Road Vehicles (BRVs), out of which 4200 have been installed with tracking devices. There has been about 50% increment in the number of BRVs from 2013 to 2021.
However, this increment resulted in a decline of average volumes per BRV by about 30% within the same period.
This implies that there has been excess supply of BRVs within the petroleum downstream which is likely to affect the profitability and sustainability of the transport sector of the industry.
The operation of BRVs goes through a series of license compliance. The first is that investors interested in the transport sector of the industry must be licensed by the National Petroleum Authority.
Section 11 (1) and (2) of the NPA act (691) stipulates that none, neither a person nor en entity could operate within the petroleum downstream without being granted a license to operate by the Board. This means that no Transport company could operate in the sector without approval from NPA.
Further, the NPA has outsourced BRV inspections to two companies to inspect the viability of these vehicles for petroleum distribution.
Also, BRV companies pay between Ghc12, 650 and Ghc24,000 annually to their facilities inspected based on their status. Again, these companies pay from Ghc750 per vehicle to Ghc1200 per vehicle depending on the amount of litres the vehicle could transport.
Although, the average performance per BRV has declined, the regulator continues to charge these license fees.
The NPA has also restricted foreign participation or foreign interest in the transportation of petroleum products in Ghana.
Any company interested in distributing or transporting petroleum products across the country must be a 100% Ghanaian owned company.
Non compliance with this requirements means the company cannot work in the petroleum downstream.
It was surprising to read media reports on alleged importation of about 600 BRVs by Sentuo Oil Refinery Limited to operate as transporters of petroleum products in the Petroleum Downstream.
The surprise stems from the fact that there is excess supply of BRVs already in the industry, which hardly achieved their investment targets.
Also, Sentuo Oil Refinery Company Limited could not import BRVs to distribute products without being approved or assured by the regulator. Or is the NPA arguing that the said company is operating without BRV license?
The NPA based on the industry reports of the unsustainability of the transport sector and the compliance of license requirements before one can operate as a BRV company, have no justification to excuse themselves of this economic injurious crime against the Ghanaian Content and Participation Policy in the petroleum downstream.
Source: Benjamin Nsiah, Director, Centre for Environmental Management and Sustainable Energy (CEMSE)