Tarzan asks: Why tax us on TOR’s loans when it’s not operating?

Energy expert, Dr. Charles Wereko-Brobby says the new fuel prices include a levy to pay for the cost of operating the Tema Oil Refinery (TOR), when in fact the refinery has been shut down.

He argues the development is unfortunate because Ghanaians should not be made to pay for the operations of a refinery which is not refining anything.

The National Petroleum Authority (NPA) announced an average of 23 percentage increase in the prices of petroleum products effective Monday, July 14, 2014.

The increments, according to the NPA, are the result of the government’s withdrawal of subsidies.

But the former Chief Executive Officer of the Volta River Authority (VRA) says he is puzzled by the explanaion.

He said it was strange that Ghanaians were being forced to pay more for the petroleum products while prices of the products on the international market are rather going down.

Dr. Wereko-Brobby also questioned why government continues to tax the people on loans contracted by TOR and pay the salaries of its workers, although the facility is no longer in operation.

“Prices of petroleum products on the international market have gone down so why are we [Ghanaians] paying more for the products here?,” he asked while speaking on the Super Morning Show on Joy FM, Monday.

“Why are we paying refinery margin and refinery recovery cost when the refinery [TOR] is not working?…So we are having to pay for the inefficiencies of the refinery and BOST [Bulk Oil Storage]; that is why we are paying more.

“TOR has not been operated for a long time but we are paying the [workers’] wages; BOST does not own any products, it is the BDCs [Bulk Oil Distribution Companies] who own products but we are paying BOST margins.

“The refinery has been closed down and yet we are paying full cost recovery; that is not fair,” he said.

TOR’s explanation 

When the Public Relations Officer for the NPA, Yaro Kasambata was reached for comments, he was unable to explain the issues relating to taxing the consumers ta pay refinery margin and refinery recovery cost, saying those are policy issues.

Mr. Kasambata however, said that information will be provided to the public later in the day.

“I am not in the position to speak these two issues…those are not answers I can speak to right now,” the PRO said.

TOR has been plagued by repeated shut downs over the past few years, often due to unavailable crude after its main lender Ghana Commercial Bank (GCB) cut off support due to unpaid debts.

Ghana’s only state-run refinery is feared to have lost more than $63 million since July 2012, as a result of its inability to process and refine crude because of broken equipment.

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