Analysts in the oil and gas sector have downplayed any significant impact of a refinery by Dangote on the operations of the Tema Oil Refinery, TOR.
They say the development though laudable, may not be able to meet the demand for refined products which makes it necessary for TOR to work to sustain its operations.
The positions of the analysts come on the back of disclosure by Dangote Group that the refinery is nearing completion.
According to Group Executive Director, Strategy, Capital Projects and Portfolio Development, Devakumar Edwin, the refinery should help integrate the downstream industries and stabilize prices within the sub-region.
The Dangote refinery is targeting to refine 650,000 barrels of oil per day.
But on the possibility of assuming majority control in the supply of refined products, the Executive Director of the Institute of Energy Security, Kwasi Anamuah Sakyi disagrees.
“The Dangote refined products will not flood the entire West African market. It does tells us that TOR can still produce and have demand for its products if not for just West Africa, for Central African market as well the product demand is quite huge and almost everything that we consume in West Africa we import, and so if TOR repositions itself well, it should be able to realize it still has the market,” he told Citi Business News in an interview.
The Executive Director of the Kumasi Institute of Technology, Energy and Environment, KITE, Ishmael Egyekumhene could not agree more.
“I cannot see Dangote’s refinery becoming a threat unless they are able to produce at a cheaper price in which case it will just be like their cement business where even though we have GHACEM, people still buy that produced by Dangote because it is cheaper. So if TOR will be able to survive, then they also need to be very efficient because the Dangote refinery will be a very brand new one whereas for ours, even though there have been a lot of refurbishment and retrofitting, has been in existence since 1962,” he intimated.
Presently, the Tema Oil Refinery has the capacity to refine 45,000 barrels of oil per day which translates into about 16.4 million barrels annually; but it is producing below that capacity, at an estimated 20,000 barrels of oil per day.
Suggestions have been made for the managers to attract investments to turnaround its fortunes to grow the downstream petroleum sector in Ghana.