The Executive Director of the Centre for Environmental Management and Sustainable Energy (CEMSE), Benjamin Nsiah has called on government to develop a comprehensive strategic policy for Ghana’s petroleum refining and downstream sector to strengthen energy security and reduce the country’s exposure to global oil price shocks.
He says a clear policy framework will help guide investment in domestic refineries, secure reliable crude oil supplies and ensure the country can meet its projected petroleum demand in the medium and long term.
According to Nsiah, Ghana’s reliance on imported petroleum products exposes the economy to external price fluctuations and places additional pressure on the country’s foreign exchange reserves and trade balance.
He argued that although Sentuo Oil Refinery and the Tema Oil Refinery (TOR) could help reduce the impact of international price shocks in the short term, a broader national strategy is needed to address the sector’s long-term challenges.
“Beyond Sentuo and TOR in the short term, I think that in the medium term, government must develop an industrial policy for the refinery or the petroleum downstream,” he said.
The CEMSE boss explained that the proposed policy should outline future supply and demand projections, identify investment requirements for expanding refining capacity and establish reliable sources of crude oil to sustain domestic production.
Nsiah also called for greater attention to domestic crude supply obligations under Section 71 of the Exploration and Production Act, 2016 (Act 919), as well as strategic partnerships with foreign crude suppliers.
He said government must determine how much additional capacity TOR and Sentuo would need to meet rising domestic demand, while identifying the financing required to support such expansion.
Nsiah believes a coordinated approach to refining capacity, crude oil sourcing and investment planning would help reduce Ghana’s dependence on imported petroleum products, conserve foreign exchange and improve the country’s resilience to external economic shocks.
He maintained that a long-term petroleum downstream strategy is essential to ensuring the availability and accessibility of petroleum products while safeguarding Ghana’s energy security.
By Eben Agyekum-Boateng, 3Business
