The Board and Management of the Tema Oil Refinery (TOR) has said it values the Collective Bargaining Agreement (CBA) negotiations and will, thus, continue to engage the unions in the interest of the refinery and its staff.
In a statement issued by TOR and signed by its Corporate and Public Affairs Manager, Kingsley Antwi- Bosiako on Thursday, 5 November 2020, the management noted that its “attention has been drawn to news making waves on the alleged incompetence of the Board of Directors (Board) of TOR.”
According to TOR, this was marked by “Management’s request to defer the Collective Bargaining Agreement (CBA) negotiations to 2021, due to the harsh economic impact of COVID-19 on TOR’s finances in 2020.”
It disclosed that the union and management of TOR meet every three years to negotiate a Collective Bargaining Agreement that sets out salary and benefits for the next three years.
It described as “unsubstantiated and unfortunate” the unions’ assertion that the Board has made no significant contribution to the Company.”
It indicated that as of “January 2017, the financial accounts of TOR had not been audited since 2013. In addition, TOR had outstanding debts of around USD 345million and also about GHS 1.05billion owed to third parties, traders and financial institutions.”
“Statutory liabilities owed GRA and SSNIT as well as utility companies and others amounted to GHS84.4million. In addition, about GHS11.8 million staff-related liabilities were outstanding as of December 31, 2016.
“It is not surprising that TOR’s books had not been audited since 2009.
“It is instructive to note that when the current Board was constituted in 2017, they discovered that TOR had missed three cycles of critical Turnaround Maintenance, which had not been out since 2009. The neglect of critical maintenance prior to the constitution of the current Board had resulted in a deteriorated refinery plant which was characterised by frequent shutdowns, inefficient operations and an unsafe working environment for the cherished staff of TOR.”
The statement also disclosed that “one of the refinery’s two crude heaters (Furnace) exploded prior to the appointment of the current Board effectively reducing the refinery’s processing capacity from the nameplate capacity of 45,000 barrels Per Stream Day (BPSD) to about 25,000 BPSD.”
“The reduced processing capacity led to its attendant reduction in revenues since it rendered the refinery only capable of processing half of its design capacity.”
The statement also highlighted that the current Board had made some progress including the procurement of “a new furnace to replace the exploded furnace”
Also, it indicated that under the current board, “TOR has seen more operation days than between 2009-2016, and has engaged with oil traders such as Woodfields, leading to the signing of a processing agreement for TOR to process 11million barrels of crude oil on their behalf since September 2019 to date” thus the current Board “has demonstrated the capacity to and also ensured that TOR has had a consistent supply of crude oil/feedstock for processing as compared to previous years” among other things.
The statement reiterated the effect of the COVID-19 pandemic on the operations of the refinery and further noted that “the management of TOR has held on to its workforce during these extremely difficult times, even though the financial impact of the COVID-19 pandemic had been felt across the globe.
It added that: “it values the CBA negotiations and will thus continue to engage them in the interest of Tema Oil Refinery and its cherished staff.”
This comes after the unionised staff of TOR demanded that the government save the country’s only refinery from collapse by dissolving the Board immediately.
In a statement co-signed by Mr Bright Adongo, Chairman of the Union of Industry, Commerce and Finance Workers (UNICOF) and Maame Serwa Duncan Williams, Chair of the General Transport, Petroleum and Chemical Workers’ Union (GTPCWU), the unionised staff said the failure of the Board in managing the refinery has resulted in a lot of debt and inefficiency.
“Nothing has been done” about TOR’s “long-standing indebtedness” to the Ghana Revenue Authority (GRA), Social Security and National Insurance Trust (SSNIT), Electricity Company of Ghana (ECG), and the Ghana Water Company Limited.
Additionally, the unions said TOR is “owing everywhere and adding on to the debt”.
The statement pointed out that “for the first time, the Board and Management could not assure workers of future prospects of revenue inflows”, adding that: “Retirees’ end-of-service benefit payments continue to be in default”.
“For the first time, Provident Fund payment is always in default”, the statement bemoaned.
Further, the unions said even though the BOST margins have been increased and passed by parliament, but the Board of TOR could not secure a similar deal for us.
“State-owned organisations got some financial relief, as a result of the COVID-19 [pandemic], but the Board of TOR could not secure a similar deal for us. No new project or initiative has been undertaken since coming into office.
“The Board has failed to secure partnership from several investors who had expressed interest in expanding the refinery capacity between 100,000 to 150,000 BPSD.
The unions said the Board, as eminent as its members are, “have not been able to exert its influence on NPA, in order to collect already-received money paid by all Ghanaians to be used for recapitalising aspects of TOR”.
“We are calling on the government to dissolve the Board because, as far as we are concerned, the Board has failed us, as mu co-chair said earlier. The Board has failed us from the beginning to an end. They have been here for four years and they cannot boast of anything, so, the government should dissolve the Board, that is what we are asking for. And when the management also misbehaves, they will follow them. No production is going on. Nothing is going on as we speak”, Duncan Williams told journalists when they picketed the premises of the refinery in Tema on Wednesday, 4 November 2020.