{"id":714376,"date":"2019-10-01T20:03:34","date_gmt":"2019-10-01T20:03:34","guid":{"rendered":"https:\/\/ghana-mma.com\/2019\/10\/01\/oil-shortage-looms-over-unhealthy-competition\/"},"modified":"2019-10-01T20:03:34","modified_gmt":"2019-10-01T20:03:34","slug":"oil-shortage-looms-over-unhealthy-competition","status":"publish","type":"post","link":"https:\/\/www.ghanamma.com\/2019\/10\/01\/oil-shortage-looms-over-unhealthy-competition\/","title":{"rendered":"Oil Shortage Looms Over ‘Unhealthy’ Competition"},"content":{"rendered":"

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Ghana is likely to suffer an oil and gas shortage due to what the Ghana Chamber of Bulk Oil Distributors (CBOD) has termed \u201cunhealthy competition\u201d amongst Bulk Distribution Companies (BDCs) and commercial banks.<\/p>\n

The unhealthy competition has reportedly resulted in the average BDC premiums falling from $ 66.60\/mt to $65.75\/mt for gasoline and $64.12\/mt to $49.23\/mt for gasoil.<\/p>\n

The Ghana Chamber of Bulk Oil Distributors (CBOD) made this known in its 2018 Oil Industry Report for Ghana\u2019s petroleum downstream sector.<\/p>\n

According to the report launched on Tuesday, October 1, 2019, \u201ccoupled with the growing forex risk and trade credit faced by the BDCs, the commercial viability of the BDC sector remains bleak.\u201d<\/p>\n

The 141-pages report noted that \u201cit is imperative that these risks are addressed for the industry\u2019s sustainability.\u201d<\/p>\n

Chief Executive of CBOD, Senyo K. Hosi, speaking at the launch in Accra, said there were a lot \u201c\u2018Irresponsible competitions\u201d in the sector that were posing risks of oil and gas shortage, warning that with the country experiencing gas shortage in the past, there was the need for care to be taken.<\/p>\n

He estimated that about $100 million has been lost to the unhealthy competition, warning banks to be a bit careful.<\/p>\n

He likened the competition in the sector and the nature of the credit arrangements as a case of \u201crobbing Peter to pay Paul.\u201d<\/p>\n

Progress In Debt Payment<\/p>\n

However, it said there was progress made on Government\u2019s legacy debt to BDCs with the payment of all outstanding principal sums amounting to $25.68 million, and the validation of the interest components.<\/p>\n

\u201cThis brings to total an amount of $806.25 million in payments made by Government for forex losses incurred between 2011 and 2015,\u201d it stated.<\/p>\n

No Loss<\/p>\n

Away from the unhealthy competition, the report noted that in 2018, no loss related to unaccounted stocks is estimated as it was revealed that 574.25mm litres more than the official stocks saleable in the country were sold.<\/p>\n

It says \u201cthis indicates that smuggled stocks in the monitored Depots must have been \u2018trapped\u2019 as a result of the National Petroleum Authority\u2019s regulatory interventions to curb the illicit trade of petroleum products and forced to be sold through official channels.<\/p>\n

The reports adds that this saved the nation GH\u00a2 797.49 million in taxes and GH\u00a2 154.93 million in regulatory margins yielding a total of savings of GH\u00a2 <\/p>\n

Consumption Rate<\/p>\n

According to the report, Ghana\u2019s gross national consumption reached 4.46 million metric tons (mt) in 2018.<\/p>\n

It adds that a total of 3.7 3 million mt was consumed by the non-power sector representing 83 percent of gross consumption while 738,076 (17\u2105) was consumed by the power sector (fuel, crude oil and propane for power).<\/p>\n

The report further reveals that out of a total of 165 registered Oil Marketing companies (OMCs) and Liquefied Petroleum Gas Marketing Companies (LPGMCs) in 2018, 14 companies were inactive, 63 sold products above 10,000mt while 88 sold volumes below 10,000mt.<\/p>\n

It says Ghana\u2019s storage capacity reached 2.18 million m3 in 2018 from a national storage of 2.093 million m3.<\/p>\n

Chief Executive of National Petroleum Authority, Alhassan Tampuli, stated that
the major policy intervention for 2018 has been the LPG promotion policy which is based on the Cylinder Recirculation Model (CRM). <\/p>\n

He stated upon full implementation, CRM is expected to completely change the mode of supply and distribution of LPG via a marketing approach which intends to guarantee safety and increase the level of LPG penetration to 50% by 2030.<\/p>\n

BY Melvin Tarlue <\/strong><\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

Ghana is likely to suffer an oil and gas shortage due to what the Ghana Chamber of Bulk Oil Distributors (CBOD) has termed \u201cunhealthy competition\u201d amongst Bulk Distribution Companies (BDCs) and commercial banks. The unhealthy competition has reportedly resulted in the average BDC premiums falling from $ 66.60\/mt to $65.75\/mt for gasoline and $64.12\/mt to […]<\/p>\n","protected":false},"author":1,"featured_media":714377,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-714376","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business"],"yoast_head":"\nOil Shortage Looms Over 'Unhealthy' Competition - Ghanamma.com<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ghanamma.com\/2019\/10\/01\/oil-shortage-looms-over-unhealthy-competition\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Oil Shortage Looms Over 'Unhealthy' Competition - Ghanamma.com\" \/>\n<meta name=\"twitter:description\" content=\"Ghana is likely to suffer an oil and gas shortage due to what the Ghana Chamber of Bulk Oil Distributors (CBOD) has termed \u201cunhealthy competition\u201d amongst Bulk Distribution Companies (BDCs) and commercial banks. 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