The Tema Oil Refinery (TOR), Ghana’s strategic but long-idle refining asset, is currently saddled with a debt of $517 million as of December 2024. This is according to the Acting Managing Director, Edmund Kombat.
Despite being inactive for nearly four years, efforts are underway to revamp operations and reposition TOR as a functional and profitable national asset, the MD said.
Mr. Kombat disclosed the figures during an engagement with the Parliamentary Select Committee on Energy at Senchi, where TOR’s leadership presented the refinery’s recovery roadmap and highlighted the longstanding challenges that have been undermining its operations.
The refinery’s ballooning debt stems from a combination of trade obligations, unpaid crude supplies, and reclassified financial transfers. Some legacy debts, initially considered grants by the Ministry of Finance, were converted into liabilities under IMF directives, compounding TOR’s fiscal woes.
“There were times that the Ministry of Finance in the past had given some funds to TOR and some of it, for example, was grants and then when they entered into the agreement with the IMF, the IMF asked them to reclassify it as debt. So, those things have accumulated to that amount of money, and I think the last time TOR traded, some of the trades were not hedged,” he said.
He further noted that past trading activities lacked hedging mechanisms, which left TOR financially vulnerable to global oil market volatilities.
While TOR’s two main processing units, the Residue Fluid Catalytic Cracking (RFCC) and the Crude Distillation Unit (CDU), have remained dormant since 2019 and 2021, respectively, recent technical assessments reveal the plant is structurally sound, Kombat noted.
“With a few technical works, we could get the plant back,” Mr. Kombat stated, adding that internal efforts to validate and renegotiate some debts have already begun yielding results, with some figures being reduced through reconciliation processes.
Management Overhaul and Operational Reforms
The new management team says it’s focused on rebuilding institutional trust and employee morale. Over 300 staff petitions were reviewed, and longstanding promotion issues were addressed as part of a broader HR restructuring plan, the MD said.
“The company has also begun mobilizing internally generated funds to support essential maintenance activities ahead of a full restart. Additionally, external auditors have been brought in to clear a six-year backlog of unaudited accounts.”
The refinery’s leadership also acknowledged that parts of TOR’s obligations have been paid through the Energy Sector Levies Act (ESLA), but outstanding amounts remain. A reconciliation process is currently ongoing with the Ministries of Finance and Energy to ensure full recovery of TOR’s ESLA entitlements.
“I can confidently tell you that before the year ends, TOR will be back,” Mr. Kombat declared, signaling an intent to align with President Mahama’s broader industrial revival agenda.
