TOR to commission new furnace by end of 2021
Tema Oil Refinery (TOR) will be commissioning a new furnace by the fourth quarter of this year to increase the refinery’s processing capacity.
Contractors are currently working on site to ensure completion of the furnace and prepare it for commissioning.
In a statement made available to the Ghanaian news agency on Wednesday, the refinery’s processing capacity was reduced from 45,000 barrels per electricity day (BPSD) to around 25,000 BPSD after one of TOR’s two crude oil heaters imploded in January 2017.
The reduced processing capacity led to a decline in sales.
“While the loss of the furnace in 2017 had a profound impact on TOR’s ability to pay its fixed costs, arrears and other payment obligations, it was wrong to say that the refinery was on the verge of collapse and was in the media. “The statement said.
It was found that the delay in completing the new furnace project was due to a lack of funding to complete the installation and commissioning by the contractor’s Italy-based engineers.
However, management added that, with support from the Department of Energy, it was able to raise funds through the Department of Finance in February 2021 to complete the revenue-generating project.
Management responded to the toll and stated that negotiations with a potential new toll partner are well advanced and are expected to be completed by June 2021.
“Regardless, other arrangements are being made with other partners to deliver crude oil for processing.”
The refinery, it was said, was undergoing minor maintenance in preparation for the next crude oil supply.
The maintenance work is expected to be completed in June 2021.
Regarding other measures to improve the refinery’s profits, it was noted that with the assistance of the Sector Department, the company has obtained a license from the National Petroleum Authority (NPA) to import petroleum products for blending in the refinery and also to the local ones Sell market to support cash flow.
They found that this was in line with TOR’s mandate set out in Company Regulation, which empowers it to conduct the business of refineries, importers, stores, suppliers, buyers and sellers of petroleum products, among others, in all of its branches .
LPG shipments began in April 2021 and “TOR recorded additional margins directly related to LPG sales”. The company entered into an agreement to begin importing other petroleum products to support its cash flows and help meet its payment obligations.
“TOR management achieved over $ 1 million reduction in insurance premiums in 2021. This was due to prudent management and an improvement in the refinery’s risk quality in 2020,” the statement said.
Management’s efforts resulted in the payment of TOR’s outstanding GHS1 billion debt incurred between 2009 and 2016.
The payment was made by the current government in support of TOR.
Another $ 167 million of the debt carried over from 2009 to 2016 was also paid by the government.
Management has also put in place a mechanism to pay off outstanding debts and ensure that the capital injection necessary for the refinery to operate effectively and reliably is in place.
Management announced that a business and revitalization plan developed as part of the required inputs for the TOR recapitalization application was approved by the State Interests and Government Agency (SIGA) in February 2021 and submitted to the Treasury Department for review .
“TOR’s management continues its efforts to pay off all other debts by agreeing payment schedules for all existing statutory debts such as GRA, SSNIT and Tier 2. However, for 2021, TOR is making efforts to stay current on all legal debts as they become due. ”
“The TOR management is also in discussion with Ghana Water Company Limited and other creditors to agree payment plans to settle old debts.
“Arrangements have also been made for payment of outstanding terminal services due to retired and resigned employees. Arrangements are also being made for the repayment of arrears on retirement funds, ”management said.
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