Torentco lease is a lousy deal, says COPEC

The government’s plan to lease the Tema Oil Refinery (TOR) to Torentco Asset Management (TAM) has oil and energy industry stakeholders raising concerns.

Duncan Amoah, the executive secretary of the Chamber of Petroleum Consumers (COPEC), is doubting the new entity’s ability to take over a significant business like TOR.

In an interview with Citi Business News, Duncan Amoah urged the administration to rethink the decision.

“If you want Torentco to manage a big company like TOR with assets running into millions of dollars, one will be asking questions of capacity and so it becomes difficult for the new company that has been formed will be able to hold the assets and day to day management of TOP such that if there is a contingency and liability arising, there will be something to hold on to. We do not have that confidence in that new entity. That right way to go is a PPA”, he said.

TOR has been considered to be leased to Torentco Asset Management Group for $22 million for 6 years and is expected to refine up to 8 million barrels annually.

Government’s decision has vehemently been criticized by industry watchers.

The Africa Centre for Energy Policy (ACEP) has for instance raised red flags because it was not done through a competitive bidding process.

During an interview on Eyewitness News on June 21, Executive Director of ACEP, Mr. Boakye expressed concerns about Torentco’s lack of experience in the petroleum industry.

However, the Senior Staff Union of TOR in a statement said Torentco is the only viable option available to bring back TOR into operation since successive governments are hesitant to inject capital into its operations.