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Tuesday(November,25 2014)

Liquefied petroleum gas: A friend not an enemy

 

In recent times, we have all been witnesses to horrifying spectacles of victims of explosions involving Liquefied Petroleum Gas (LPG) cylinders and other mishaps at some domestic places in many parts of the country, usually leading to fatality.

The catastrophic explosions at Nyaniba Health Assistants Training School in Tema, Valco Estate, the University for Development Studies in Wa, Ashaiman, Axim and Kwahu-Foda in the Eastern Region are still fresh on our minds.

This is a timely discretion of the National Petroleum Authority’s mandate as a regulator of the petroleum downstream industry in ensuring that the public understands the risks and dangers of not using LP Gas safely and discouraging any unconventional use without seeking expert advice to ensure safety.

LPG

LPG belongs to a family of chemical compounds called hydrocarbons. As the name implies, it only consists  of hydrogen and carbon atoms.

It is produced as a result of the refinery of crude oil into its various petroleum product components such as LPG, petrol, kerosene, diesel and residual fuel oil.

Properties of LPG

LPG is as safe as any other fuel to use. However, as we all know, anything that generates heat and energy, if not handled with care, can create difficulties. There are five main properties of LP Gas which are explained below;

LPG is a Gas

Firstly, LPG in its normal condition is a gas but it can be pressurised at low temperature into liquid so that it is stored in cylinders and storage vessels. 

LPG is lighter than water

The weight of LPG is about half the equivalent of water. It can be recalled that some years ago, it was reported that two people went into an LPG vessel apparently to carry out maintenance works and they died. 

There are laid down rules and procedures that have to be followed before one can go into an LPG vessel such as wearing of protective clothing, safety reinforced boot and most importantly, nose mask or breathing filters.

Before you go into an LPG vessel, you can pour water into the vessel from the top to the bottom gradually until the water fills the LPG vessel. LPG being lighter than water will gradually come to the surface and subsequently escape from the vessel. You leave the vessel for about 24 hours. 

Every LPG vessel has what we call bottom drain valves , you can drain the valves to allow the water to escape and close the valve. After that, you can go inside and work. In that case, all the LPG might have been expelled. 

It’s heavier than air

LPG roughly weighs twice as much as air. So in our kitchens,  if there is a leakage of LP gas, it can flow on the ground in gutters, depressions, and basements and can travel at a considerable distance from the point of leakage. Therefore when there is an explosion, it can travel far away from the point of leakage.

It’s highly flammable

When mixed in the right proportion with air and a source of ignition can cause an explosion. 

It’s odourless and colourless 

LPG has no scent. However, an odourant is added to LPG so that in the event of a leakage you can smell it.

Advantages

LPG offers a myriad of advantages for both end-users and the community as a whole. Simplicity of transport, storage and use are combined with its immediate availability and negligible impact on the environment. Other benefits include cost;

It’s cheaper than charcoal

Let’s take a typical 14.5kg LPG cylinder which cost about GH¢48 and a bag of charcoal which cost GH¢35 to GH¢40 which is being used by a household of about five people. 

The 14.5kg LPG can be used between eight to 10 weeks while the charcoal will not last for more than four weeks. Comparatively, LPG is cheaper to use than charcoal.

It’s environmentally friendly

It is environmentally safe and friendly, particularly in urban areas, thanks to low particle emissions, low nitrogen oxide emissions, and low sulphur content.  

What to do when you smell Gas

If you smell gas at home, the first thing to do is to open the windows to get rid of the gas. Make sure the nob to the gas cooker and the regulator is turned off.

If these two things are turned off and you can still smell the gas, then there are two possible sources of the leakage. The valve is damaged or the rubber hose is loose. 

If it is safe to do so, try to locate the source of the leakage by applying a solution of soapy water to the base of your cylinder valve or along the flexible hose. 

If bubbles appear and become bigger or increase in number then you have a leakage. Knowing where the leakage is helps prevent accidents. 

Take it to an LPG plant for replacement. 

To conclude therefore, LP Gas is very useful and almost indispensable, that is why we must always strive to abide by its rules of use to forestall unpleasant consequences.

 

The Writer is with the Public Relations and Consumer Service Department of the National Petroleum Authority.

 Email: bowusu@npa.gov.gh. The information can also be obtained from the National Petroleum Authority's website (www.npa.gov.gh)

- See more at: http://graphic.com.gh/features/opinion/34279-liquefied-petroleum-gas-a-friend-not-an-enemy.html#sthash.W41V2JuW.dpuf
In recent times, we have all been witnesses to horrifying spectacles of victims of explosions involving Liquefied Petroleum Gas (LPG) cylinders and other mishaps at some domestic places in many parts of the country, usually leading to fatality.

The catastrophic explosions at Nyaniba Health Assistants Training School in Tema, Valco Estate, the University for Development Studies in Wa, Ashaiman, Axim and Kwahu-Foda in the Eastern Region are still fresh on our minds.

This is a timely discretion of the National Petroleum Authority’s mandate as a regulator of the petroleum downstream industry in ensuring that the public understands the risks and dangers of not using LP Gas safely and discouraging any unconventional use without seeking expert advice to ensure safety.

LPG

LPG belongs to a family of chemical compounds called hydrocarbons. As the name implies, it only consists  of hydrogen and carbon atoms.

It is produced as a result of the refinery of crude oil into its various petroleum product components such as LPG, petrol, kerosene, diesel and residual fuel oil.

Properties of LPG

LPG is as safe as any other fuel to use. However, as we all know, anything that generates heat and energy, if not handled with care, can create difficulties. There are five main properties of LP Gas which are explained below;

LPG is a Gas

Firstly, LPG in its normal condition is a gas but it can be pressurised at low temperature into liquid so that it is stored in cylinders and storage vessels. 

LPG is lighter than water

The weight of LPG is about half the equivalent of water. It can be recalled that some years ago, it was reported that two people went into an LPG vessel apparently to carry out maintenance works and they died. 

There are laid down rules and procedures that have to be followed before one can go into an LPG vessel such as wearing of protective clothing, safety reinforced boot and most importantly, nose mask or breathing filters.

Before you go into an LPG vessel, you can pour water into the vessel from the top to the bottom gradually until the water fills the LPG vessel. LPG being lighter than water will gradually come to the surface and subsequently escape from the vessel. You leave the vessel for about 24 hours. 

Every LPG vessel has what we call bottom drain valves, you can drain the valves to allow the water to escape and close the valve. After that, you can go inside and work. In that case, all the LPG might have been expelled.
 
It’s heavier than air

LPG roughly weighs twice as much as air. So in our kitchens, if there is a leakage of LP gas, it can flow on the ground in gutters, depressions, and basements and can travel at a considerable distance from the point of leakage. Therefore when there is an explosion, it can travel far away from the point of leakage.

It’s highly flammable

When mixed in the right proportion with air and a source of ignition can cause an explosion. 

It’s odourless and colourless 

LPG has no scent. However, an odourant is added to LPG so that in the event of a leakage you can smell it.

Advantages

LPG offers a myriad of advantages for both end-users and the community as a whole. Simplicity of transport, storage and use are combined with its immediate availability and negligible impact on the environment. Other benefits include cost;

It’s cheaper than charcoal

Let’s take a typical 14.5kg LPG cylinder which cost about GH¢48 and a bag of charcoal which cost GH¢35 to GH¢40 which is being used by a household of about five people. 

The 14.5kg LPG can be used between eight to 10 weeks while the charcoal will not last for more than four weeks. Comparatively, LPG is cheaper to use than charcoal.

It’s environmentally friendly

It is environmentally safe and friendly, particularly in urban areas, thanks to low particle emissions, low nitrogen oxide emissions, and low sulphur content.
 
What to do when you smell Gas

If you smell gas at home, the first thing to do is to open the windows to get rid of the gas. Make sure the nob to the gas cooker and the regulator is turned off.

If these two things are turned off and you can still smell the gas, then there are two possible sources of the leakage. The valve is damaged or the rubber hose is loose. 

If it is safe to do so, try to locate the source of the leakage by applying a solution of soapy water to the base of your cylinder valve or along the flexible hose. 

If bubbles appear and become bigger or increase in number then you have a leakage. Knowing where the leakage is helps prevent accidents. 

Take it to an LPG plant for replacement. 

To conclude therefore, LP Gas is very useful and almost indispensable, that is why we must always strive to abide by its rules of use to forestall unpleasant consequences.
 
Friday(November,21 2014)

NPA BARES TEETH ON ILLEGAL PETROLEUM PRODUCTS DEALERS

Poised to ensure that bad industry practices do not thrive at the expense of others who are playing by the rules, the National Petroleum Authority (NPA) has begun a nation-wide exercise to clamp down on illegal sales of petroleum products.

The operation led by the Chief Inspector, Mrs Esther Anku and the Northern Zonal Manager, Theophilus Mohenu of NPA which was in collaboration with the security agencies, targeted table top sellers of petrol and diesel in the Kumasi metropolis, Ejisu and Asante-Akyem municipality’s in the Ashanti region.

Ten dealers engaged in the illegal trade were arrested while about 1800 litres of illegally obtained petroleum products were confiscated.

The fuel vendors sell petrol and diesel in gallons by the streets and other established locations, where fuel is placed in drums and served with the use of huge funnels to fill up gallons and vehicles of clients that turn up.

The NPA believes these table top dealers are either selling products at unapproved prices or engaged in adulteration of products to make higher profit margins.

Briefing the media, the Head of Public Relations and Consumer Services, Yaro Kasambata said the exercise was in conformity with Section 31 of the NPA Act 691(2005).

The NPA Act prohibits any person, other than one licensed under the Act, from being in possession of a petroleum product in quantities unreasonably in excess of that person’s immediate requirement.

According to Mr Kasambata, the activities of those arrested contravened the provisions of the Act as they had not been licensed by the authority to deal in the products.

He explained, however, that the exercise was limited to those who dealt in petrol and diesel but not those who sold kerosene as the law allowed petty trading in kerosene.

“We cannot tell at this stage where they get their products from but clearly from the distribution cycle in the industry, no Bulk Distribution Company will supply products to peddlers”.

The fear is that these illegal sales of petroleum products could lead to fire explosions as the dealers of the highly inflammable fuel operate with no safety measure.

Mr. Kasambata says the ongoing operation is to uphold the quality, pricing and safety in retailing of petroleum products.

“We are doing this to ensure that we can sanitize the downstream industry,” he stated. “We want to ensure that standards are applied across board in all aspects of the industry.”

The clamp down will be extended to other parts of the country.

Source: PR/CS
Thursday(November,20 2014)

A GRAND SENDOFF FOR STEVEN LARBI

Immediate past Manager for Public Relations and Consumer Service of the National Petroleum Authority (NPA), Steven Larbi has been treated to a grand sendoff party as he retires from NPA after nearly a decade of dedicated service.

The event brought together staff, top management and the governing board of the Authority to celebrate Mr. Larbi’s life-long career and dedicated service to NPA and mother Ghana.

Mr Steven Larbi has had a media career spanning nearly three decades. He was instrumental in pioneering the Public Relations and Consumer Services department of the then young NPA when it was established nearly 10 years ago. He has also contributed to the promotion of journalism in West Africa.

The event was also attended by the first CEO of NPA, John Attafuah who shared fond memories of Mr Larbi dating back to events during the interview which led to the employment of Mr. Larbi in NPA.

He said he was there to “celebrate, applaud, embrace and salute one of the finest Senior Journalist and PR Practitioner to ever walk in NPA doors as one of the first employees, our beloved friend and PR manager, Steven Larbi.”

The Chief Executive of NPA, Moses Asaga acknowledge that his brief experience with Mr Larbi prior to his retirement stands him out as an experienced and knowledgeable media practitioner hence management decision to include him on the committee of Consumer Services of the Authority.

Adding, NPA will always fall on the rich experience of Mr. Larbi when the need arises.

In his closing remarks, Steven said the party was “way over the top, but it is so much fun and I have so much enjoyed it.”

He also thanked many others, including the governing board and employees of NPA.

“I am proud to say I worked with all of you,” Steven said.

Source: PR/CS
Monday(November,10 2014)

NPA intensifies public education on LPG usage

The National Petroleum Authority (NPA) on Monday launched consumer week celebration under the theme, ‘LPG-A friend not an enemy’’ at Kwame Nkrumah Circle in Accra.

It was meant to educate Ghanaians, especially domestic users, on the usage of liquefied petroleum gas (LPG) in the country.

The consumer week celebration is observed every November, each year, to educate the public on the safe use of petroleum products and increase the public’s knowledge on their rights and responsibilities.

Speaking at the launch of the week, the Chief Executive of the NPA, Hon. Moses Asaga said “there have been series of explosions involving LPG Cylinders and LPG related fires in parts of the country in recent times, as reported by the media.

“We are concerned about these incidents, hence our focus on safety to intensify public education on the safe use and handling of LPG. These LPG related accidents have caused many deaths, injuries and destroyed properties worth millions of cedis”.

He, therefore, called on Ghanaians to observe safety rules when dealing with LPG-from bulk storage haulage, retailing and domestic handling to ensure that these accidents are reduced to the barest minimum, if not completely eliminated.

At the industry level, Mr. Asaga told the well-attended gathering that teams of technical inspectors are constantly on the move inspecting all facilities in the petroleum product supply chain, stressing from the depots, and in transit through to the retail station. They have a firm grip on these areas.

The challenge, however, he said “is the domestic handling where there is no inspector at homes and point of usage to check that the consumer is doing the right thing. Which is why we are dedicating this week to inform and educate the public that LPG is safe, if used safely? Hence the theme ‘LPG: A Friend Not An enemy’.”

Touching on awareness creation programmes, Mr. Asaga noted that over the years NPA had used a series of publicity mix to drive home the message on the safe use of LPG.

To this end, the NPA boss said “We are intensifying our audio visual animation on the safe uses of LPG which is currently showing on GTV in both English and other local languages.

“We are going to increase the telecast of these series to other networks in the coming days with a media mix of radio, TV, newspaper, website and all trending social media to ensure that no one is left in the sensitization process.

“We are also going to include radio, community durbars to remind the people that LPG is safe and they should use it safely”.

Over the years, consumption of LPG has witnessed a considerable increase. An average of 228,000 metric tonnes of LPG is supplied every year from 2010 till date.

This represents 8% of the total average petroleum products supplied to the market, according to Mr. Asaga.
It is estimated that the auto users of LPG consume about 58% of the total annual LPG supplied while households, other commercial activists and industry, together consume the remaining 42% as at 2013.

Consumption of LPG is projected to increase to 491, 000 metric tonnes in 2020 and 1.2million metric tonnes by 2030, he revealed.

This, Mr. Asaga indicated: “We have accepted LPG as a cheaper fuel. What is left to achieve is to remind consumers on the safe uses of LPG”.

A Deputy Minister of Energy and Petroleum, John Abdulai Jinapor said the theme for this year’s consumer Week Celebration could not have come at any better time than now, and called on all to make safety the key word in handling LPG, to reduce if not eliminate the reported cases fires associated with LPG.

LPG is safe if used safely. LPG is cleaner for our environment and still remains the cheaper fuel for domestic use. It ensures that the environment is presented for the next generation with the selling of fewer trees for wood fuels, he stated.

Dr Opoku Ware Ampomah, Director, Reconstructive Plastic Surgery and Burns Centre said it was important for stakeholders to preach preventive measures because no amount of plastic surgery could restore a burnt victim to his or her normal self.

“Some people’s lives have been changed, others have been traumatised and some have also become suicidal due to burns.”

He noted that for a burn victim to be treated effectively and efficiently it will require GH?26,000, an amount he said was not affordable to many, adding that the National Health Insurance only provides GH?950 for the treatment of a burn victim.


Source: PR/CS
Friday(October,31 2014)

OIL MARKET NEWS (WEEK 44): WEEK ENDED OCTOBER 31, 2014

Major Highlights
  • Brent crude oil trades in a range of $84-$87 per barrel
  • The weekly average GHS/USD exchange rate stabilize when compared to the previous week
  • Ukraine, Russia and the EU sign deal to resume gas supplies to Ukraine
  • Ghana’s stock of petrol decreases; diesel remains unchanged when compared to the previous week’s stock levels
  • Total U.S commercial petroleum inventories decreased by 8.5 million barrels last week
Brent crude oil trades in a range of $84-$87 per barrel

Average Dated Brent price for the week (published by Platts) decreased marginally by $0.10 to $85.55 per barrel from the previous week's average of $85.65 a barrel, indicating 0.12% decrease. Brent crude oil slipped as the dollar strengthened and Chinese data pointed to slower economic growth as well as weaker fuel demand in the world’s biggest energy market.

China’s services sector grew at its slowest pace in nine months in October as a cooling property sector weighed on demand, a survey, adding to signs of fragility in the world’s second-largest economy and biggest energy consumer.

The dollar powered to a seven-year peak against the yen and a two-year high against the euro, extending gains after the Bank of Japan's latest stimulus and punishing oil and gold priced in the U.S. currency.

"The optimism created by the Bank of Japan by increasing their purchase of quantitative assets has been hit by the Chinese manufacturing data, which fell well short of expectations," Naeem Aslam, chief market analyst at Ava Trade, said.

Free on board (FOB) prices of Petrol increased by $4.60 to $791.95/MT from the previous week's average of $787.35, indicating 0.58% increase; Diesel increased by $9.25 to $744.45/MT from the previous week’s average of $735.20, indicating 1.26% increase; and LPG increased by $1.20 to $566.00/MT from the previous week’s average of $564.80, indicating 0.21% increase, during the period under review.

The weekly average GHS/USD exchange rate stabilize when compared to the previous week

The average GHS/US Dollar exchange rate stabilized when compared to the previous week. The stability of the Ghana Cedi against the USD, resulted in no change in the USD values and the GHS equivalent FOB prices.

The GHS/US Dollar exchange rate for the period 27th October2014 to 31st October 2014 was 3.1967 compared to 3.1967 during the previous week. The GHS equivalent of FOB prices for petrol, diesel and LPG increased by 0.58%, 1.26% and 0.21% respectively, during the same period under review.

Geopolitics

Ukraine, Russia and the EU sign deal to resume gas supplies to Ukraine

Ukraine, Russia and the European Union signed a deal that will see Moscow resume vital supplies of gas to its ex-Soviet neighbour over the winter in return for payments funded in part by Kiev's Western creditors.

After several failed rounds of talks in recent weeks as conflict rumbles on despite a ceasefire with pro-Russian rebels in eastern Ukraine, the accord also eases concerns that a new "gas war" could disrupt winter supplies if energy to EU states, notably through pipelines shut down across Ukraine since June.

Elsewhere, Iraqi security forces said they advanced to within 2 km (1.2 miles) of the city of Baiji in a new offensive to retake the country’s biggest oil refinery, besieged since June by Islamic State militants.

Backed by Shi’ite militias and army helicopters, government forces have swept through a desert area to the west of Baiji, aiming to recapture the city 200 km (130 miles) north of the capital.

Inventories

Ghana’s stock of petrol decreases; diesel remains unchanged when compared to the previous week’s stock levels

Ghana’s stock of Diesel and Petrol to last 3.3 and 2.8 weeks respectively (as at October 27, 2014). Diesel’s stock of 3.3 weeks remained unchanged compared to last week’s stock to last, while Petrol’s stock of 2.8 weeks compare unfavorably to last week’s stock of 2.9 weeks.

According to the import schedule, petrol of about 33.6 million litres was expected for delivery to add to existing stockpiles for the market. LPG of about 7 million kilogrammes was also expected for delivery by close of the week (November 1, 2014). The CDU and RFCC remain shut down for planned mini maintenance and lack of feed.
The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), reported in its Weekly Petroleum Status Report for October 24, 2014 that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 2.1 million barrels to 379.7 million barrels while gasoline stockpiles decreased by 1.2 million barrels to 205.9 million barrels. Inventories of distillate fuel, a category including heating oil and diesel, decreased by 5.3 million barrels to 122.9 million barrels over the same period. Total commercial petroleum inventories decreased by 8.5 million barrels last week.

Demand and Supply

Total U.S commercial petroleum inventories decreased by 8.5 million barrels last week

The EIA in its Weekly Petroleum Status report for October 24, 2014 reported that, U.S. crude oil imports averaged about 7.1 million barrels per day last week, down by 376,000 barrels per day from the previous week.

Over the last four weeks, crude oil imports averaged about 7.5 million barrels per day, 3.6% below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 493,000 barrels per day. Distillate fuel imports averaged 40,000 barrels per day last week.

Total products supplied over the last four-week period averaged about 19.3 million barrels per day, up by 1.2% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged 8.8 million barrels per day, down by 1.1% from the same period last year.

Distillate fuel product supplied averaged about 3.6 million barrels per day over the last four weeks, down by 4.0% from the same period last year. Jet fuel product supplied is up 8.2% compared to the same four-week period last year.

References
• www.bloomberg.com
• www.reuters.com
• www.bbc.co.uk
Thursday(October,30 2014)

NPA CEO ASAGA BAGS TWO AWARDS

The Chief Executive of the National Petroleum Authority (NPA), Moses Asaga has bagged two prestigious awards. The awards are the “Nobles International Award’ for upholding the virtues of honesty, integrity and accountability by the West Africa Nobles Awards and the National “Achievers Awards” by the Northern Youth for Peace and Development.

 At the 20th West Africa Nobles Annual Congress and Award held in Akosombo, Mr. Moses Asaga was recognized for his contribution to Parliamentary work both at the committee level and nationally during his 16-year tenure as Member of Parliament (MP) for the Nabdam Constituency in the Upper East Region.

A citation by the West Africa Nobles Forum mentions his extra-ordinary commitment to Parliamentary work and as a Minster of States at various times in Ghana’s history of democratic governance.

Mr. Moses holds a BSc in Industrial Chemistry from Kwame Nkrumah University of Science and Technology (KNUST), MSc in Petroleum Engineering from Aberdeen University and an MBA, Finance from Yonsei University-Korea. Mr. Asaga also holds an MPhil in Financial Economics from Durham University, United Kingdom.

Mr. Moses Asaga also received the National Achievers Awards by the Northern Youth for Peace and Development (NYUPED) at the 3rd NYUPED National Achievers Award.  

The citation mentioned the interventions by Mr. Asaga’s in parts of the Northern Regions to improve quality of life in such deprived, marginalized and disadvantaged communities; providing educational grants to poor but brilliant students, contributing financial resources towards construction of both educational and socio – cultural infrastructures, and facilitating the development of youthful talents to harmonize and maintain peace among the people.

NYUPED also recognized the great interventions by Mr. Asaga in advancing the lives of many brilliant but needy young people whose education would have been in peril, had it not been for “your splendid generosity dispensed” the citation reads in part.
 
Tuesday(October,28 2014)

Ghanaians control 50% of the downstream petroleum industry-Asaga

 Fifty percent (50%) of businesses operating in the Petroleum downstream industry in Ghana are wholly Ghanaian owned companies.

This signifies the Ghanaian success story of local content in the petroleum downstream industry in Ghana.

This came to light when the Chief Executive of the National Petroleum Authority (NPA), Moses Asaga addressed more than 500 final year students of the School of Business, University of Cape Coast. The lecture focused on the developments in the petroleum downstream industry: prospects and challenges.

According to Mr. Asaga, in the petroleum downstream today, there are more than 3000 petroleum retail outlets, 82 Oil Marketing Companies (OMCs), 42 LPG Marketing Companies, 545 transporters with more than 2500 Bulk Road Vehicles (BRVs), 24 Bulk Distribution Companies (BDCs) and 2 Oil Trading Companies (OTCs) adding “Ghanaian ownership in these Petroleum Service Providers (PSPs) is 50% and that is a positive outcome of the deregulation process which is ongoing in the petroleum downstream industry”.

Mr. Asaga told the students that in 2013, 3.3million tonnes of petroleum products were consumed in Ghana owing to increased economic activities in the country. “As the economy continues to grow, this consumption pattern will increase” Mr. Asaga told the over 500 eager audience.

Explaining further, Mr. Asaga said with the rapid growth and expansion in the downstream industry calls for increased monitoring and enforcement of regulatory standards. “Until recently, more than 30% of the fuel consumed in Ghana was adulterated thereby compromising the quality fuel the consumer needs but with the introduction of our novel program called Petroleum Product Marking Scheme-PPMS, in less 12months, adulteration has been reduced to 1% that is something NPA must be commended for” Mr. Asaga said.

Touching on the deregulation process, the Chief Executive of the NPA said, the deregulation process has made great impact on the industry and the economy but more needs to be done in boosting the infrastructural needs of the industry to meeting the increasing demand for petroleum products.

Some of the challenges facing the industry are the slow process of price ‘De-control’ resulting in under recoveries (Subsidies) which are borne by government. Delay in subsidy payments is gradually making investment in the sector unattractive hence the Infrastructure bottlenecks in the supply chain.

Answering question on the significance of the recent 2% reduction in prices of petroleum products, Mr. Asaga explained that “the 2% reduction in fuel price was very significant, because for just 2 weeks, this 2% reduction is 10million Ghana Cedis which has been given to consumers and  in another 2 weeks that is 20 Million Ghana Cedis-if we decide to buy exercise books for every primary school child, this would be enough for every school-going child, in the oil business, we deal with volumes, the volume consumed is all that what makes the difference.”

The lecture was at the instance of the School of Business, University of Cape Coast to boost the understanding of the students as they near completing of their course.

A Senior Lecturer of the University, Dr. John Gatsi thanked NPA for information and called for closer collaboration between industry and academia to boost national development.
Wednesday(October,22 2014)

PRESS RELEASE - RE: FILLING STATIONS CHEAT CONSUMERS

Our attention has been drawn to consumer concerns in the media that some filling stations are still selling petroleum products at the old prices even though fuel prices have been reduced by 2%.

The National Petroleum Authority (NPA) wishes to assure consumers of petroleum products that our monitoring teams are inspecting all filling stations across the country to verify compliance with the new the prices and defaulting filling stations will be sanctioned in accordance with the law.

We further wish to encourage consumers to lodge a complaint with the NPA where they find a filling station not complying with the reduced prices and such cases would be dealt with.

Contact us: 0302-766195-6, toll-free-080012300, email-info@npa.gov.gh


Issued By:

National Petroleum Authority

ENA House

No. 20 Boundary Road

East-Legon

 
Tuesday(October,21 2014)

Keynote Address Delivered by Hon. Emmanuel Armah Kofi Buah, Minister for Energy and Petroleum, on a Workshop for Parliamentary Press Corps on Operations of NPA

The Chairman;

Distinguished Guests;

Members of the Parliamentary Press Corps;

I deem it a great pleasure that I have been invited to grace this workshop and to give an insight and share my experiences in the Petroleum Downstream sector and the operations of the National Petroleum Authority.

I have selected two major areas in the downstream sector that I would discuss with you today. These are;
  1. Government’s efforts towards full deregulation and the role of the Bulk Distribution Companies.
  2. The determination and petroleum prices and subsidies.

Ladies and Gentlemen, simply put, deregulation of the downstream sector means the removal of government controls thereby allowing forces of demand and supply to determine Ex-pump prices of petroleum products at the filling stations.

It must be noted that full deregulation of the sector will come with onerous responsibilities on the National Petroleum Authority (NPA) and government to ensure the following:
  • No barriers to enter the downstream business and zero cartelization.
  • Full Cost Recovery based on Import Parity Benchmarking
  • Raise government revenue through the imposition of petroleum taxes/levies.
  • And among others, guarantee that petroleum product prices are the same throughout the country through the Unified Petroleum Price Fund (UPPF).

Chairman, it may interest you to know that even though the road to full deregulation has been bumpy, Government is committed to achieve full deregulation of the petroleum downstream sector;
  • NPA has been driven to encourage private sector participation and to target 50% true local indigenous participation in all activities
  • NPA has been tasked to develop regulations that create enabling environment for full deregulation
  • Petroleum Service Providers (PSPs) are being encouraged to compete fairly by setting their own Ex-Pump prices below the maximum indicative prices (e.g. GOIL consistently had lower indicative prices a couple of months ago)
  • Bulk Road Vehicle Tracking System to ensure integrity and accuracy of product distribution is being implemented
  • Fuel Marking Scheme Program to ensure integrity and purity of petroleum products has earnestly started.
The quest for full deregulation has led to the licensing of a number of BDCs who augment the shortfall in petroleum product supply on the market due to the current challenges at the Tema Oil Refinery.

Presently, BDCs account for a large share of petroleum products supplied to Ghana. They have continued to invest in infrastructure to enhance storage capacity of the nation thereby assisting in increasing our product stock security. BDCs account for about 34% of the nation’s storage capacity for finished products.

Ladies and Gentlemen, as you well know NPA has the mandate to set petroleum prices. They use the Import Parity formula based on Platts and Argus index and include supplier’s margin and various taxes/levies to determine local prices of petroleum products at the filling stations.

In the past Governments have pursued a policy of subsidizing prices of petroleum products as and when it considered full cost recovery too high to pass on to consumers. This unfortunately led to the accumulation of under recoveries owed to the BDCs. In 2013, Government removed all subsidies with the exception of premix fuel for the fishing communities. However, recent depreciation of the cedi has resulted in “false subsidies” consequently increasing outstanding under recoveries.

Chairman, Government is relentlessly pursuing various strategies that will actively, effectively and consistently implement Full Cost Recovery Policy at all times to avoid further accumulation of under recoveries and indebtedness to the BDCs.

I thank you once again for having me. I am hopeful that this workshop will comprehensively afford you an insight into the operations of the NPA and the petroleum downstream.


 
Monday(October,20 2014)

Press Release - Fuel Prices Reduced

The National Petroleum Authority (NPA) announces an average reduction of two percent (2%) in fuel prices effective 6am of Tuesday October 21, 2014.

These reductions are in accordance with reduction in the prices of crude oil and petroleum products on the world market.

The NPA has directed all Oil Marketing Companies (OMCs) to comply with these price reductions accordingly.                                                                                          
Friday(October,17 2014)

OIL MARKET NEWS (WEEK 42): WEEK ENDED OCTOBER 17, 2014

  Major Highlights
  • At $85.41/BBL, Dated Brent continues its downward trend amid plentiful supply
  • The weekly average GHS/USD exchange rate appreciates compared to the previous week
  • Gunfire and air strikes reported in Libya's second city, Benghazi
  • Ghana’s stock of both petrol and diesel increases compared to the previous week’s stock levels.
  • Total U.S commercial petroleum inventories increased by 1.0 million barrels last week.
  • The IEA cut its 2014 and 2015 oil demand growth by 200,000 and 300,000 bpd respectively.
At $85.41/BBL, Dated Brent continues its downward trend amid plentiful supply

Average Dated Brent price for the week (published by Platts) decreased by $4.76 to $85.41 per barrel from the previous week's average of $90.17 a barrel, indicating 5.28% decline.

Brent crude oil continued its downward trend, recording its lowest weekly average of the year, as growing concerns over the global economy stretched a four-month rout.

Mounting evidence of slackening demand and unrelenting U.S. shale output left traders struggling to peg a floor for crude's four-month rout.

Also weighing were news that key Middle East producers signaled they would keep output high even if that meant lower prices. Expectations faded that OPEC could cut output in an effort to shore up prices.

"It suggests there's some nervousness in the market that Saudis are seeking to bring pressure on the shale producers in the U.S.," said Gene McGillian, an analyst at Tradition Energy.

Eugen Weinberg, analyst at Commerbank in Frankfurt said "the market still seems very bearish, and despite us seeing a floor around $80, even this floor might come into danger if we don't have any signal from OPEC any time soon."

Free on board (FOB) prices of Petrol decreased by $97.85 to $804.80/MT from the previous week's average of $902.65, indicating 10.84% decline; Diesel decreased by $32.05 to $737.00/MT from the previous week’s average of $769.05, indicating 4.17% decline; LPG decreased by $57.80 to $561.80/MT from the previous week’s average of $619.60, indicating 9.33% decline, during the period under review.

The weekly average GHS/USD exchange rate appreciates compared to the previous week

The average GHS/US Dollar exchange rate strengthened compared to the previous week. The appreciation of the Ghana cedi against the USD, decreased marginally the impact of the exchange rate on the ex-pump prices of petroleum products.

The GHS/US Dollar exchange rate for the period 13th October 2014 to 17th October 2014 was 3.1983 compared to 3.1987 during the previous week.

The GHS equivalent of FOB prices for petrol, diesel and LPG decreased by 10.85%, 4.18% and 9.34% respectively, during the same period under review.

Geopolitics

Gunfire and air strikes reported in Libya's second city, Benghazi

Gunfire and air strikes have been reported in Libya's second city, Benghazi, amid an offensive to drive out Islamist militias.

The offensive is said to involve forces loyal to ex-general Khalifa Haftar, who is also reportedly backed by the army. Egypt has denied a report by the Associated Press news agency that its aircraft bombed targets in Benghazi.

Libya has been gripped by a power struggle between the militias who drove out Muammar Gaddafi in 2011. The interim government, recognised internationally, has fled to the city of Tobruk because of unrest in the capital, Tripoli.

However, militias who control Tripoli and Benghazi have announced the formation of their own government. Mr Haftar this week announced an operation to retake Benghazi from the Islamists. According to the AFP news
agency, he has the backing of the army.

Inventories

Ghana’s stock of both petrol and diesel increases compared to the previous week’s stock levels

Ghana’s stock of Diesel and Petrol to last 2.6 and 3.4 weeks respectively (as at October 13, 2014). Diesel’s stock of 2.6 weeks compare favorably to last week’s stock to last of 2.4 weeks, while Petrol’s stock of 3.4 weeks compare favorably to last week’s stock of 2.8 weeks.

According to the import schedule, Diesel of about 92.3 million litres was expected for delivery, while Petrol of about 47.0 million litres was expected for delivery to add to existing stockpiles (October 18, 2014). The CDU and RFCC remain shut down for planned mini maintenance and lack of feed.

Total U.S commercial petroleum inventories increased by 1.0 million barrels last week

The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), reported in its Weekly Petroleum Status Report for October 10, 2014 that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 8.9 million barrels to 370.6 million barrels while gasoline stockpiles decreased by 4.0 million barrels to 208.4 million barrels.

Inventories of distillate fuel, a category including heating oil and diesel, decreased by 1.5 million barrels to 127.2 million barrels over the same period. Total commercial petroleum inventories increased by 1.0 million barrels last week.

Demand and Supply

The IEA cut its 2014 and 2015 oil demand growth by 200,000 and 300,000 bpd respectively

The International Energy Agency (IEA) cut its 2014 oil demand growth by 200,000 bpd to 0.7 million bpd. It again estimated that demand for oil in 2015 will grow far slower than previously forecast as global economies remain weak, and prices may extend their sharp fall so long as OPEC shows no sign of countering a supply surge.

The IEA said it cut its 2015 estimate for oil demand growth by 300,000 barrels per day (bpd) from its previous forecast and now expects demand growth of 1.1 million bpd to 93.5 million.

The EIA in its Weekly Petroleum Status report for October 10, 2014 reported that, U.S. crude oil imports averaged over 7.7 million barrels per day last week, up by 28,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged 7.4 million barrels per day, 8.4% below the same four-week period last year.

Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 428,000 barrels per day. Distillate fuel imports averaged 145,000 barrels per day last week.
Total products supplied over the last four-week period averaged 19.3 million barrels per day, up by 1.6% from the same period last year.

Over the last four weeks, motor gasoline product supplied averaged 8.8 million barrels per day, down by 0.5% from the same period last year. Distillate fuel product supplied averaged about 3.8 million barrels per day over the last four weeks, up by 0.7% from the same period last year. Jet fuel product supplied is up 4.4% compared to the same four-week period last year.

References
  • www.bloomberg.com
  • www.reuters.com
  • www.bbc.co.uk
Friday(October,03 2014)

OIL MARKET NEWS (WEEK 40): WEEK ENDED OCTOBER 3, 2014

  Major Highlights
  • Dated Brent experiences its lowest weekly average of the year at $93.40/bbl.
  • The weekly average GHS/USD exchange rate appreciates by 0.06%.
  • IS steps up attack on Syrian town of Kobane.
  • Ghana’s stock of petrol increases while diesel declines compared to the previous week.
  • Total U.S commercial petroleum inventories decrease by 5.8 million barrels last week.
Dated Brent experiences its lowest weekly average of the year at $93.40/bbl

Average Dated Brent price for the week (published by Platts) decreased by $1.74 to $93.40 per barrel from the previous week's average of $95.14 a barrel, indicating 1.83% decline.

Brent crude oil fell to its lowest weekly average of the year, as ample supplies, a lacklustre global economy and the strengthening of the U.S. dollar to a four-year peak against a basket of major currencies, outweighed concerns about potential loss of supply as a result of conflict in the Middle East.

Official Oil Price cuts from top producer Saudi Arabia added to supply glut worries and weak global economic data.

A Reuters survey found that, OPEC’s oil supply jumped to its highest in almost two years in September due to further recovery in Libya and higher output from Saudi Arabia and other Gulf producers in the face of sub-$100 per barrel oil prices.

The lack of any cutbacks underlines the relaxed view of OPEC’s core Gulf members to oil’s slide from $115 in June to $97 on Tuesday-a level they can tolerate, but which puts budgets in producers such as Iran and non-member Russia under pressure.

“The sentiment remains overwhelmingly bearish at the moment: there is little support for demand, while supply is strengthening,” Carsten Fritsch, a commodities analyst at Commerzbank, said.

Free on board (FOB) prices of Petrol decreased by $13.10 to $923.95/MT from the previous week's average of $937.05, indicating 1.40% decline; Diesel decreased by $12.60 to $796.05/MT from the previous week’s average of $808.65, indicating 1.56% decline; LPG decreased by $27.10 to $687.70/MT from the previous week’s average of $714.80, indicating 3.79% decline, during the period under review.

The weekly average GHS/USD exchange rate appreciates by 0.06%

The average GHS/US Dollar exchange rate strengthened compared to the previous week. The appreciation of the Ghana cedi against the USD, decreased marginally the impact of the exchange rate on the ex-pump price of petroleum products.

The GHS/US Dollar exchange rate for the period 29th September 2014 to 3rd October 2014 was 3.1987 compared to 3.2006 during the previous week (0.06% appreciation).

The GHS equivalent of FOB prices for petrol, diesel and LPG decreased by 1.46%, 1.62% and 3.85% respectively, during the same period under review.

Geopolitics

IS steps up attack on Syrian town of Kobane

A BBC correspondent across the border in Turkey said mortars struck Kobane's eastern outskirts and there was heavy machine-gun and small arms fire.

IS has moved to within 1km (0.6 miles) of the town despite air strikes seeking to halt its two-week offensive. Turkey has promised it will do whatever it can to prevent the fall of Kobane.

Prime Minister Ahmet Davutoglu made the vow after the Turkish parliament authorised military operations against militants in Iraq and Syria, as well as the use of Turkish bases by foreign forces.

A US-led international coalition is carrying out air strikes against IS positions in Iraq and Syria. More than 160,000 Syrians, mainly Kurds, have fled across the border since IS launched an offensive to capture Kobane on 15 September.

Inventories

Ghana’s stock of petrol increases while diesel declines compared to the previous week

Ghana’s stock of Diesel and Petrol to last 1.4 and 3.7 weeks respectively (as at September 29, 2014). Diesel’s stock of 1.4 weeks compare unfavorably to last week’s stock to last of 1.9 weeks, while Petrol’s stock of 3.7 weeks compare favorably to last week’s stock of 2.9 weeks.

According to the import schedule, Diesel of about 110.1 million litres was expected for delivery, while Petrol of about 50.7 million litres was expected for delivery to add to existing stockpiles (October 4, 2014). The CDU and RFCC remain shut down for planned mini maintenance and lack of feed.

The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), reported in its Weekly Petroleum Status Report for September 26, 2014 that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 1.4 million barrels to 356.6 million barrels while gasoline stockpiles decreased by 1.8 million barrels to 211.2 million barrels.

Inventories of distillate fuel, a category including heating oil and diesel, decreased by 2.9 million barrels to 128.3 million barrels over the same period. Total commercial petroleum inventories decreased by 5.8 million barrels last week.

Demand and Supply

Total U.S commercial petroleum inventories decrease by 5.8 million barrels last week

The EIA in its Weekly Petroleum Status report for September 26, 2014 reported that, U.S. crude oil imports averaged 7.3 million barrels per day last week, up by 414,000 barrels per day from the previous week.

Over the last four weeks, crude oil imports averaged about 7.5 million barrels per day, 6.3% below the same four-week period last year.

Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 504,000 barrels per day. Distillate fuel imports averaged 31,000 barrels per day last week.

Total products supplied over the last four-week period averaged over 19.2 million barrels per day, up by 1.1% from the same period last year.

Over the last four weeks, motor gasoline product supplied averaged 8.7 million barrels per day, down by 0.7% from the same period last year.

Distillate fuel product supplied averaged about 3.8 million barrels per day over the last four weeks, up by 0.8% from the same period last year. Jet fuel product supplied is down 2.6% compared to the same four-week period last year.

References
  • www.bloomberg.com
  • www.reuters.com
  • www.bbc.co.uk
Friday(September,26 2014)

OIL MARKET NEWS (WEEK 39): WEEK ENDED SEPTEMBER 26, 2014

  Major Highlights

  • Brent crude oil trades in a range of $94-$96 per barrel
  • The average GHS/USD exchange rate weakens by 0.03% compared to the previous week
  • US and other allies hits IS oil targets in Syria
  • Ghana’s stock of petrol unchanged; diesel improves compared to the previous week’s stock levels
  • Total U.S commercial petroleum inventories increase by 0.9 million barrels last week.

Brent crude oil trades in a range of $94-$96 per barrel

Average Dated Brent price for the week (published by Platts) decreased by $1.86 to $95.14 per barrel from the previous week's average of $97.00 a barrel, indicating 1.92% decline.

Brent crude oil fell, pressured by rising supplies and a strong U.S. dollar which outweighed concerns about potential loss of supply as a result of conflict in the Middle East.

Also contributing to Brent crude oil drop was concerns about tepid demand for oil in Europe and China. "At the moment, supplies are abundant and demand is weaker," said Andrey Kryuchenkov, an analyst at London-based VTB Capital.

Losses were limited as the United States and several Gulf Arab allies launched strikes against Islamic State strongholds in Syria, and as a surprise pick-up in China's factory activity boosted the demand outlook. "Geopolitical risk is a factor in the market's mind ... but the market is dominated by supply," said Ric Spooner, chief market analyst at CMC Markets.

Free on Board (FOB) prices of Petrol decreased by $11.40 to $937.05/MT from the previous week's average of $948.45, indicating 1.20% decline; Diesel decreased by $17.65 to $808.65/MT from the previous week’s average of $826.30, indicating 2.14% decline; LPG decreased by $16.70 to $714.80/MT from the previous week’s average of $731.50, indicating 2.28% decline, during the period under review.

The average GHS/USD exchange rate weakens by 0.03% compared to the previous week

The average GHS/US Dollar exchange rate weakened at a slow pace compared to the previous week. The depreciation of the Ghana cedi against the USD, increased marginally the impact of the exchange rate on the ex-pump price of petroleum products. 

The GHS/US Dollar exchange rate for the period 22nd September 2014 to 26th September 2014 was 3.2006 compared to 3.1998 during the previous week (0.03% depreciation).

The GHS equivalent of FOB prices for petrol, diesel and LPG decreased by 1.18%, 2.11% and 2.26% respectively, during the same period under review.

Geopolitics

US and other allies hits IS oil targets in Syria

The US, Saudi and UAE carried out airstrikes that killed 14 of IS fighters and five civilians in eastern Syria. The airstrikes were targeted at oil refineries controlled by the group.

According to the Pentagon, the refineries generated up to $2m (£1.2m) per day in revenue for the militants. In northern Syria, Kurdish forces say they have pushed back an IS advance.

US President Barack Obama has vowed to dismantle the IS "network of death". IS has seized large areas of Syria and Iraq in recent months and controls several oilfields.

Sales of smuggled crude oil have helped finance its offensive in both countries. The US has launched nearly 200 air strikes against the militants in Iraq since August and expanded the operation against IS to Syria.

Inventories

Ghana’s stock of petrol unchanged; diesel improves compared to the previous week’s stock levels

Ghana’s stock of Diesel and Petrol to last 1.9 and 2.9 weeks respectively (as at September 22, 2014). Diesel’s stock of 1.9 weeks compare favorably to last week’s stock to last of 0.7 week, while Petrol’s stock of 2.9 weeks remained unchanged from last week’s stock of 2.9 weeks.

According to the import schedule, Diesel of about 59.2 million litres was expected for delivery, while Petrol of about 51.1 million litres was expected for delivery to add to existing stockpiles (September 27, 2014). The CDU and RFCC remain shut down for planned mini maintenance and lack of feed.

The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), reported in its Weekly Petroleum Status Report for September 19, 2014 that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 4.3 million barrels to 358.0 million barrels while gasoline stockpiles decreased by 0.4 million barrels to 213.0 million barrels.

Inventories of distillate fuel, a category including heating oil and diesel, increased by 0.8 million barrels to 131.2 million barrels over the same period. Total commercial petroleum inventories increased by 0.9 million barrels last week.

Demand and Supply

Total U.S commercial petroleum inventories increase by 0.9 million barrels last week

The EIA in its Weekly Petroleum Status report for September 19, 2014 reported that, U.S. crude oil imports averaged 6.9 million barrels per day last week, down by 1.2 million barrels per day from the previous week.

Over the last four weeks, crude oil imports averaged about 7.6 million barrels per day, 4.7% below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 510,000 barrels per day. Distillate fuel imports averaged 193,000 barrels per day last week.

Total products supplied over the last four-week period averaged 19.4 million barrels per day, up by 1.5% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged 8.9 million barrels per day, and remained unchanged from the same period last year.

Distillate fuel product supplied averaged over 3.7 million barrels per day over the last four weeks, down by 0.2% from the same period last year. Jet fuel product supplied is up 3.4% compared to the same four-week period last year.

References

• www.bloomberg.com
• www.reuters.com
• www.bbc.co.uk

Wednesday(September,10 2014)

The essence of the National Petroleum Authority


The petroleum downstream industry has been a contest between the industry players (petroleum service providers) and the consumer. The industry wants profitability while the consumer wants value for money. None of these must occur at the expense of the other.    

It is for this reason that  the regulator (NPA) was established to innovate and adopt strategies to ensure that the industry remains efficient and profitable but at the same time consumers receive value for money.

This new paradigm was also designed to liberalise the sector and remove the inefficiencies, thereby lifting the government’s  “arm” from being the only source of supply and financier of the petroleum product requirements of the country, while paving the way for a free and efficient marketplace.

Poised to be a catalyst for Ghana’s economic transformation and growth, the mandate of the NPA, according to the NPA Act 2005 (Act 691), covers a broad spectrum of tasks. Among others, it is to regulate, oversee and monitor activities in the Petroleum Downstream Industry.

Downstream ?

By downstream, we mean all activities involved in the importation and refining of crude oil or the sale, marketing and distribution of refined petroleum products in the country.

The various commercial activities of the downstream industry in respect of petroleum products include: Importation, exportation, re-exportation, shipment, transportation, processing, refining, storage, distribution, marketing and sale of petroleum products.

Some achievements

The downstream petroleum industry has seen dramatic transformation in the past nine years. Key changes include:

Private sector participation in the petroleum downstream industry

The industry, for the first time in several years, has seen an unprecedented proliferation of investment and expansion of petroleum products storage and outlet facilities by the private sector, mostly dominated by a growing number of indigenous Ghanaian companies due to the deregulation of the petroleum downstream industry.

The authority has granted licences to a significant number of new entrants to operate as petroleum service providers (PSPs) in the industry. Consequently there are currently over 700 licensed companies in 20 different categories in the downstream sector.

At the moment, there are 21 oil trading companies and 24 bulk distributing companies that supplement production from the Tema Oil Refinery through the importation of finished petroleum products to meet the demand deficit. More than 500 transporters have been licensed to supply and transport petroleum products in the country.

Others include 81 oil marketing companies, 42 LPG marketing companies (LPGMCs), 22 bunkering companies, calibration companies, which used to be three before the establishment of the NPA but are now five; three lubricant manufacturing; three lubricant blending and marketing, nine petroleum products export companies, seven bulk oil storage depots, a new refinery, a mooring company, an emulsified fuels production company, and a stratification company, among others.

The involvement of the private sector in the importation of crude oil/ refined petroleum products has minimised the Government’s involvement in procuring or financing the petroleum product requirements of the country, thereby making more resources available for other developmental projects and programmes.

This has also resulted in the reliable supply of crude oil or petroleum products.

Unified Petroleum Pricing Fund (UPPF) Scheme

The NPA has put in place a UPPF scheme which ensures that there is regular supply of petroleum products to all parts of the country, irrespective of the geographical location, at the same price.

The UPPF sees to it that petroleum products are efficiently transported across the country in a manner that is simple, effective and inexpensive to operate administratively.

Protecting the interests of consumers

As a regulator, we are concerned about the growing number of calls by consumers with regard to the poor quality of fuel and inaccurate quantity of fuel dispensed at the pumps at various stations.

In order to ensure sanity in the sale and marketing of products in the petroleum downstream sector, the NPA introduced the Petroleum Product Marking Scheme (PPMS) to ensure that the quality of products is devoid of adulteration and meets the required specification as the one loaded from the depots to retail outlets. Offenders are duly sanctioned in accordance with LI 2187.

Additionally, the quantity of products offered for sale at the pump is assessed to ensure that the customer is not cheated. For this purpose, the NPA, in collaboration with the Ghana Standards Authority, developed and introduced the 10-litre measuring can to guide consumers at retail outlets and to give consumers the ability to verify the accuracy of dispensing pumps when they are in doubt.

Enhancing the performance of PSPs

Our focus at the NPA is to ensure that all stakeholders pitch in to further improve standards. The authority, in collaboration with other stakeholders has provided comprehensive guidelines and standards to guide the operations of various PSPs. This is aimed at improving the efficiency, compliance and safety of the industry.

Furthermore, the authority embarks on several nationwide inspections throughout the year to ensure that PSPs are operating according to the stipulated guidelines.

In conclusion, imagine a game of football where there is no referee, no rules and no standards; it becomes  a ‘free-for-all’ contest where the strongest takes advantage of the weak; or better still, it can be linked to the jungle’s “survival of the fittest”.

Therefore, it is worthy to note that the role the NPA plays in the petroleum downstream industry goes beyond just the pricing of petroleum products, contrary to comments by some think tanks and social commentators.

NPA’s operations include other management functions such as planning, research, monitoring and the setting of standards in the downstream petroleum industry.

Its existence and operations are vital in sustaining the development of the petroleum downstream industry in Ghana.
Friday(September,05 2014)

OIL MARKET NEWS (WEEK 36): WEEK ENDED SEPTEMBER 5, 2014

Major Highlights
  1. Brent crude oil trades in a range of $99-$101 per barrel.
  2. The average GHS/US Dollar exchange rate depreciates by 1.24% compared to the previous week.
  3. Libyan parliament reappoints former Prime Minister.
  4. Ghana’s stock of diesel increases; petrol declines compared to the previous week’s stock.
  5. U.S total commercial petroleum inventories increase by 1.5 million barrels the previous week.

Brent crude oil trades in a range of $99-$101 per barrel

Average Dated Brent price for the week (published by Platts) increased by $0.43 to $100.66 per barrel from the previous week's average of $101.10 a barrel, indicating 0.43% decline.

Brent crude oil fell marginally as Chinese and U.S. data pointed to slower-than-expected growth in the world's top oil consumers. Prospect of slowing oil demand growth in Europe, a strong dollar and ample supplies pushed prices down.

"The Chinese data, with imports showing disappointing results, indicates the domestic economy remains quite weak," said Victor Shum, senior partner at oil consultancy Purvin & Gertz. Oil prices have been in steady decline since the end of June as concerns faded over supply disruptions from Iraq, Libya and Russia. Continued supply from key producing regions and tepid demand has left global markets well stocked.

Free on board (FOB) prices of Petrol increased by $5.99 to $970.30/MT from the previous week's average of $964.31, indicating 0.62% rise; Diesel decreased by $5.61 to $856.95/MT from the previous week’s average of $862.56, indicating 0.65% decline; and LPG decreased marginally by $0.75 to $754.25/MT from the previous week’s average of $754.25, indicating 0.10% decline, during the period under review.

The average GHS/US Dollar exchange rate depreciates by 1.24% compared to the previous week

The GHS/US Dollar exchange rate weakened for the second consecutive week after stabilizing the previous three weeks.

The depreciation of the Ghana cedi against the USD, increased the impact of the exchange rate on the ex-pump price of petroleum products.

The GHS/US Dollar exchange rate for the period 1st September 2014 to 5th September 2014 was 3.1736 compared to 3.1346 during the previous week (1.24% depreciation).

The GHS equivalent of FOB prices for petrol, diesel and LPG increased by 1.87%, 0.59% and 1.14% respectively, during the period under review.

Geopolitics

Libyan parliament reappoints former Prime Minister

Libya's parliament reappointed Prime Minister Abdullah al-Thinni as the government lost control of ministries in the capital where armed groups have taken over and a separate parliament has claimed legitimacy.

In another sign of the oil producer sliding deeper into anarchy, Islamist militants launched a new attempt to seize Benghazi's civilian and military airport from army forces allied to a renegade general. At least 13 soldiers from Haftar's forces were killed and 45 wounded, medics said.

The reappointment of Thinni, a former defence minister and career soldier who has been prime minister since March, sets him the challenge of reasserting government control over a country where many fear a descent into full-scale civil war.

Parliamentary spokesman Faraj Hashem said 64 of the 106 representatives present had voted for Thinni and the house had instructed him "to form a crisis government within a period of time not exceeding two weeks."

Inventories

Ghana’s stock of diesel increases; petrol declines compared to the previous week’s stock

Ghana’s stock of Diesel and Petrol to last 1.5 and 0.9 weeks respectively (as at September 1, 2014).

Diesel’s stock of 1.5 weeks compare favorably to last week’s stock to last of 1.4 weeks, while Petrol’s stock of 0.9 weeks compares unfavorably to last week’s stock of 2.0 weeks.

According to the import schedule, Diesel of about 46.7 million litres was expected for delivery, while Petrol of about 87.2 million litres was expected for delivery to add to existing stockpiles.

LPG of about 4.0 million kilogrammes was also expected for delivery by close of the week (September 6, 2014). The CDU and RFCC remain shut down for planned mini maintenance and lack of feed.

The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), reported in its Weekly Petroleum Status Report for August 29, 2014 that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 0.9 million barrels to 359.6 million barrels while gasoline stockpiles decreased by 2.3 million barrels to 212.6 million barrels.

Inventories of distillate fuel, a category including heating oil and diesel, increased by 0.6 million barrels to 126.0 million barrels over the same period. Total commercial petroleum inventories increased by 1.5 million barrels last week.

Demand and Supply

U.S total commercial petroleum inventories increase by 1.5 million barrels the previous week.

The EIA in its Weekly Petroleum Status report for August 29, 2014 reported that, U.S. crude oil imports averaged over 7.7 million barrels per day last week, up by 42,000 barrels per day from the previous week.

Over the last four weeks, crude oil imports averaged over 7.7 million barrels per day, 5.8% below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 801,000 barrels per day. Distillate fuel imports averaged 153,000 barrels per day last week.

Total products supplied over the last four-week period averaged over 19.7 million barrels per day, up by 2.7% from the same period last year. Over the last four weeks, motor gasoline product supplied averaged about 9.1 million barrels per day, down by 0.7% from the same period last year.

Distillate fuel product supplied averaged 3.9 million barrels per day over the last four weeks, up by 5.1% from the same period last year. Jet fuel product supplied is up 1.3% compared to the same four-week period last year.

References
• www.bloomberg.com
• www.reuters.com
• www.bbc.co.uk
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