Managing Director of TOR was forced to resign for failing to sign a dubious deal – IES

The Institute for Energy Security (IES) has revealed reasons behind the resignation of Managing Director of the Tema Oil Refinery (TOR).

Isaac Osei announced his exit from the company at a staff end of year party on Friday, December 20, 2019.

Mr Osei took over from Kwame Awuah Darko as the Managing Director (MD) of TOR in 2017 and has been credited with improving the fortunes of the organisation.

These achievements include embarking on a needed shut down maintenance to improve upon the performance and reliability of the refinery after it had missed three cycles of scheduled shut down maintenance before his appointment.

That is not all.

Mr Osei, who is also former Ghana Cocoa Board MD, is credited with the payment for a  steam boiler which increases steam generation capacity for plant operations and ensures the reliability of the Refinery’s utility system.

But despite these achievements, IES has alleged that Mr Osei was forced to leave his post for refusing to sign a deal which will result in bad debt to the state.

A statement signed by its Executive Director Paa Kwasi Anamuah Sakyi commended the outgoing MD for his show of integrity.

Below is the full statement issued by the IES

ANOTHER QUESTIONABLE SCHEME TO HURT THIS COUNTRY IN THE OFFING

1. The Institute for Energy Security (IES) wishes to first and foremost commend the outgoing Managing Director (MD) of the Tema Oil Refinery (TOR) for choosing a path of integrity (resignation) rather than to continue as MD and invariably become a party to a questionable scheme that would hurt this country, benefit few private individuals, and saddle TOR and Ghana with more debts.

2. Investigations by the IES indicates that the MD of TOR was forced to leave his post for refusing to sign-off a Tolling Agreement (TA) at a rate of US$1.5 per barrel for the
utilization of both the Crude Distillation Unit (CDU) and the Residual Fluid Catalytic
Cracker (RFCC); instead of an average rate of US$4.5 per barrel for an $11m barrel
cargo to be refined.

3. Currently, TOR charges Vitol/WoodfieldsUS$2.5 per barrel for the utilisation of only the CDU, without the use of the RFCC. Should TOR agree to sign for a Tolling Fee of US$1.5 per barrel, the entity would be unable to cover the operational cost, let alone start and operate the plant; as TOR needs a minimum revenue of $US6 million on monthly basis to begin to recover, assuming no debt is paid.

4. It is this unfair and uneconomical agreement that some persons of interest were
exerting pressure on Mr. Osei to sign-off, or resign instead. Had he agreed to this, the
huge difference in the questionably discounted Tolling Agreement running into millions of dollars would have gone into private pockets as effortless profit. To the public purse, however, this will be hard debts to be borne by the Ghanaian taxpayer without anyone being prosecuted for it. It would have simply been explained as usual as bad debts due to “management mistakes and wrong judgment.”

5. It would be recalled that IES in January 2018 called on the government to arrest the
leadership crisis at TOR which subsequently led to a loss of over $24 million in just one transaction and bad judgment. Almost three years under his leadership the refinery still struggles to operate at full capacity, with low asset utilization.

6. While the IES has had issues with Isaac Osei’s leadership of TOR in the past and would have expected to see him sacked months ago, his recent resignation and the issues outlined above present him as a bold spirit in the fight against corruption, stealing, and patronage.

7. The Institute would do Ghana a great disservice if the issues surrounding Mr Osei’s
resignation is not publicly and laid bare for the Ghanaian public to understand, and to be prepared to bear a potential loss of US$27.5 million to the state
if TOR subsequently agrees to process the 11million barrels of crude on account of
some greedy institution and personalities.

8. While the IES is fully aware that the government is taking drastic steps to appoint a
“more cooperative” MD to take-over from Mr Osei to push through this
questionable agreement among others, the IES wishes to send out a clear signal to
government of its preparedness to go an extra mile to ensure TOR, and by extension
Ghana is not ripped off anymore.
Signed:
PaaKwasi Anamuah Sakyi
Executive Director, IES