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Wednesday(April,13 2016)

OIL MARKET NEWS (WEEK 14): WEEK ENDED 8TH APRIL, 2016

Major Highlights
  • Brent crude oil price falls on skepticism of major producers freezing output.
  • The weekly average GHS/USD exchange rate appreciates when compared to last week.
  • Staff evacuated from shuttered Libyan oil fields due to militant threat.
  • Diesel’s current stock decreases, petrol unchanged when compared to the previous week.
  • Diesel and Petrol imports of over 65 and 101 million litres respectively, expected by 16th April, 2016.
  • Iran expects 4 million barrels per day (mbpd) oil output by March 2017.
  • U.S. crude oil imports down by 494,000 barrels per day when compared to the previous week.
Average Dated Brent price for the week (published by Platts) decreased by $0.39 to $37.47 per barrel from the previous week's average of $37.85 a barrel, indicating 1.02% decrease. Brent crude oil price fell, as investors doubted that producing countries will freeze output to rein in a worldwide glut. Oil prices remain up about 40 percent from around 12-year lows struck in mid-February, although the rally has fizzled on growing skepticism about a proposed output freeze by major producers. "It appears that the speculative longs that were enticed toward the buyside of the energy complex through most of the first quarter by the upcoming production freeze meeting are now heading for the exits," said Jim Ritterbusch at Chicago-based energy markets consultancy Ritterbusch & Associates. Russia believes an oil price at $45-$50 per barrel is acceptable for the global oil market to balance, as it prepares to meet leading oil producers in Doha later this month, sources familiar with Russian plans said on Wednesday. "The level of $45-50 (per barrel) is acceptable from the point of view of market balance: if prices go higher shale oil production could start to recover."

Free on board (FOB) prices of petro decreased by $14.29 to $459.90/MT from the previous week's average of $474.19, indicating 3.01% decrease, diesel decreased by $14.06 to $319.25/MT from the previous week’s average of $333.31, indicating 4.22% decrease, and LPG also decreased by $6.55 to $274.70/MT from the previous week’s average of $281.25, indicating 2.33% decrease, during the period under review. The average Bank of Ghana GHS/USD exchange rate appreciated when compared to the previous week. The GHS/USD exchange rate for the period 4th April – 8th April, 2016 was 3.8287 compared to 3.8353 for the previous week (0.17% appreciation).
Geopolitics

Libyan security personnel have evacuated Staff from three oil fields in eastern Libya because of fears of attacks by Islamic State militants, but production has not been affected because the fields are shut, oil and security officials said. Islamic State militants have launched frequent attacks on Libyan oil fields and terminals in recent months, damaging facilities but not taking control of them. Unlike in Syria and Iraq, Islamist militants have never controlled oil fields in Libya, but officials worry this could happen in the future, along with existing material and human damage. Mohamed al-Manfi, an oil official based in eastern Libya, said the Wafa field had been completely evacuated and the Tibesti and Bayda fields were partially evacuated after security forces warned of possible planned attacks. A security source told Reuters that fighters loyal to Islamic State had been mobilizing in Nawfiliyah, a town between the extremist group's Libyan stronghold of Sirte and the oil ports of Es Sider and Ras Lanuf. Earlier this month five members of the Petroleum Facilities Guard were killed in an attack by suspected Islamic State militants near Bayda field, about 250 km (155 miles) south of Es Sider and Ras Lanuf. The guard is a semi-military force that controls many oil facilities in the east. Labour disputes, militant attacks and conflict between local communities and armed factions have sharply cut back Libya's oil production in recent years. Production currently stands at less than one fifth of the 1.6 million barrels per day the OPEC member was producing before the 2011 uprising that toppled Muammar Gaddafi.

Inventories

Ghana’s current stock of diesel and petrol will last 4.1 and 3.5 weeks respectively (as at 4th April, 2016). Diesel’s current stock-to-last of 4.1 weeks decreased when compared to last week’s stock-to-last of 4.3 weeks, while petrol’s current stock-to-last of 3.5 weeks, remained unchanged when compared to last week’s stock-to-last of 3.5 weeks. According to the import schedule, diesel of over 65 million litres is expected for delivery, while petrol of over 101 million litres is expected for delivery to add to existing stockpiles for the market. LPG of about 5 million kilogrammes is also expected for delivery by close of the week (16th April, 2016). The CDU and RFCC at TOR are currently producing at a rate of 3,105MT per stream day (51.69% operating rate) and 1,531MT per stream day (71.71% operating rate) respectively. The Gas Processing Plant at Atuabo was shut down on Sunday, 20th March, 2016 for mandatory inspection and maintenance works on the FPSO Kwame Nkrumah, and is expected back online on 24th April, 2016.

The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), in its Weekly Petroleum Status Report for week-ended 1st April, 2016 reported that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 4.9 million barrels to 529.9 million barrels. Total motor gasoline inventories increased by 1.4 million barrels to 225.7 million barrels. Inventories of distillate fuel, a category including heating oil and diesel, increased by 1.8 million barrels to 180.1 million barrels over the same period. Total commercial petroleum inventories increased by 1.1 million barrels last week.

Demand and Supply

Iranian Oil Minister Bijan Namdar Zanganeh said the country's crude output would reach four million barrels per day (bpd) by March 2017, state television reported. "In the annual budget, the amount of oil export has been predicted around 2,250,000 bpd. This means our production this (Iranian) year will reach four mbpd," Zanganeh was quoted as saying by state TV. The Iranian new-year started on March 20. Zanganeh said Iran's oil output has increased after the lifting of international sanctions in January under a nuclear deal with six major powers. Sanctions imposed on Iran in early 2012 by the United States and European Union over its nuclear programme had cut crude exports from a peak of 2.5 million bpd before 2011 to just over 1 million bpd in recent years.

The EIA in its Weekly Petroleum Status report for week ended 1st April, 2016 reported that, U.S. crude oil imports averaged about 7.3 million barrels per day last week, down by 494,000 barrels per day from the previous week. Over the last four weeks, crude oil imports averaged about 7.8 million barrels per day, 2.1% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 671,000 barrels per day. Distillate fuel imports averaged 62,000 barrels per day last week.

U.S. crude oil refinery inputs averaged 16.4 million barrels per day during the week ending April 1, 2016, 199,000 barrels per day less than the previous week’s average. Refineries operated at 91.4% of their operable capacity last week. Gasoline production increased last week, averaging over 9.6 million barrels per day. Distillate fuel production decreased last week, averaging over 4.8 million barrels per day.
 
References
  • www.reuters.com
  • www.eia.gov
Wednesday(March,23 2016)

Amended NPA Act hailed amid petrol price increases

Petroleum Minister, Emmanuel Armah-Kofi Buah, has spoken of the Price Liberalisation Policy’s critical importance to the petroleum downstream sector, amidst a five percent increment in prices of petroleum products.

According to Mr. Buah, the decision to allow oil marketing companies to set their own prices at the pumps, based on current market conditions, is the best thing to happen for the country’s petroleum sector; and maintains that it will allow competition and market forces to determine prices of petroleum products.

He made this announcement following Parliament’s passage of the National Petroleum Authority (Amendment) bill, 2015, which among others things give legal backing to the Price Liberalisation Policy.

“The amendment that has been concluded is basically adding price liberalisation into the downstream business that allows competition and market forces to determine prices. And that is why you see that in this era when petroleum prices have gone down, the benefit is going to the consumer,” he said.

He said effects of the price deregulation policy have spread throughout the sub-region, adding: “Across the West African sub-region, the markets that are doing well have been deregulated and I am happy Ghana has taken the lead. Now we have clearly passed the amendment that states it is the market which determines prices, we believe social democratic governments will be very mindful. That is why we continue to intervene in premix fuel for fishermen. It is very critical the markets going forward will work. Price liberation is good for the ordinary consumer”

Government adopted a Full Deregulation Policy in 2005 to halt its continuous intervention in the pricing of petroleum products in the country, with the fuel subsidy bill rising astronomically to the detriment of private market players.

The Policy was also meant to ensure full cost-recovery and uniformity in pricing of petroleum products by allowing the market to determine prices, a report from the Select Committee on Mines and Energy stated.

Furthermore, for the purpose of facilitating implementation of the Policy, the National Petroleum Authority Act, 2005 (Act 691) was passed in the year 2005 to establish the National Petroleum Authority (NPA) to provide a framework for regulating the petroleum market.

Within the key mandate of the NPA under the Act is determining prices of petroleum products in the country, through application of the prescribed petroleum formula.

However, with commencing the implementation of price liberalisation under the deregulation policy, the NPA has ceased to determine prices of petroleum prices.

The reported further indicated that, currently, petroleum service providers determine the indicative maximum ex-refinery and ex-pump prices in the country. The new dispensation has therefore confined the NPA’s role to monitoring the formula’s application.
Wednesday(March,23 2016)

ADDRESS BY THE CHIEF EXECUTIVE OF THE NATIONAL PETROLEUM AUTHORITY, DR. MOSES ASAGA AT THE INAUGURAL CEREMONY OF THE GHANA NATIONAL PETROLEUM TANKER DRIVERS UNION HELD ON SATURDAY 19TH MARCH, 2016, AT THE GLOBAL HAULAGE YARD NEAR TEMA OIL REFINERY (TOR) AT 10:00AM

Good morning to you Mr. Chairman distinguished invited guests, Ladies and gentlemen.

I bring you warm greetings from the Chief Executive of the National Petroleum Authority, Hon. Dr Moses Asaga.

The CEO regrets his inability to be here to be part of the inauguration of the newly elected officers of your Union.

He is constrained by other equally pressing official assignments and I hereby convey his deepest regrets to you. The Authority respects very much the invitation by your union to be part of today’s inauguration ceremony.

This is because of the importance NPA attach to the role the Tanker Driver on the Tanker Drivers Union.
Mr. Chairman, Distinguished Invited Guests, Ladies and Gentlemen,
One of the key objectives of the National Petroleum Authority is to ensure the regular supply of petroleum products to all parts of the country. This objective however cannot be achieved without the BRV (Tanker) driver.

All petroleum deliveries to retail outlets and bulk customers in the country are delivered by BRVs. Last year, over 95% of inter product transfers to inland depots, were done using BRVs. This emphasizes the importance of the BRV (Tanker) driver in the distribution of petroleum products in the country. The role of the Petroleum BRV (Tanker) driver in the petroleum product supply chain is a very critical one. But this role has its associated safety challenges.

The ‘tanker’ is a brute of a vehicle. Standing 3.4 meters tall and 15.5 meters in length, it looks large and powerful and is a potential safety threat on our roads when not properly handled. As responsible partners we want members of the public to have the assurance that together we are   doing our utmost best to ensure their safety.

Therefore the Authority wants our drivers to be highly skilled and knowledgeable in their profession. We expect your union to champion this as well. We will support all activities aimed at improving skills and knowledge.

Just last week the Police Officers and Fire Service Personnel worked hard to avert a potential fatal disaster after a gas tanker overturned on the Mallam-Kasoa Highway resulting in  leakage of  Liquefied Petroleum Gas (LPG) on the road. But for the timely intervention of our security forces we could have had a disaster on our hands.

We would therefore like to use this opportunity to urge all of you to be more safety conscious by observing road traffic signs, and avoid all the practices and behaviors that lead to accidents e.g. excessive and reckless speeding, dangerous over taking, avoid night driving and use of mobile phones while driving etc. You are also urged to take the pre-trip inspections of your vehicles such as checking of tire pressure, headlights, hazard lights, tail/brake lights and pointers/traficators, windshield wipers etc very seriously.

As partners in the industry we shall continue to engage you and seek to continuously improve the safety standards and practices in the industry in order to ensure your safety and the safety of other road users and the general public. We shall encourage Transport owners to introduce incentives to promote safe driving practices among the drivers and also promote their welfare.

Mr. Chairman, let me also take this opportunity to assure the Tanker Drivers Union that NPA in collaboration with relevant state institutions will continue to create an enabling environment for the operations of the transportation section of the Petroleum Downstream Industry. For example Works have already commenced on the construction of a modern Tanker parking lot for 1000 BRVs equipped with firefighting equipment, catering facilities, resting halls among others at Tema. This is part of the Authority’s plans to improve safety standards in the industry and this is specifically aimed at eliminating safety risk posed by indiscriminate parking of BRVs on roads leading to TOR and other depots In Tema and also provides a decent resting place for drivers awaiting to be loaded. The project is expected to be completed by September 2016

Mr. Chairman, distinguished guests, Ladies and gentlemen at this juncture, I pledge the Authority’s recognition and support for the Union and look forward to very fruitful engagement in future for the betterment of the industry.

Thank you very much and God bless you all.
Tuesday(January,05 2016)

Commonwealth University Awards Moses Asaga with Doctorate Degree

 The Commonwealth University in collaboration with the London Graduate School have awarded Chief Executive of the National Petroleum Authority, Moses Asaga with a Doctorate Degree at the just ended 12th Dubai Leadership Summit.

Dr. Moses Asaga was honoured with a Doctorate Degree in Public Administration (DPA) based on his continuous excellence in politics and public service.

The convocation took place in Dubai, with more than thirty (30) recipients from Ghana, Nigeria and South Africa – who are Chief Executives in various public and private corporations who have distinguished themselves in their respective field of work fields of work.

The Commonwealth University is a corporate distance learning university registered in two jurisdictions (Belize and Panama). Commonwealth University degree programmes are accredited by the International Association for Distance Learning (IADL) and the International Council for Management Consulting Institutes (ICMCI).

The London Graduate School is the appointed tuition provider and administrator of Commonwealth University degree programmes and several other universities. The London Graduate School is registered in the United Kingdom to provide distance, open, flexible or work based educational programmes.
Thursday(November,12 2015)

BIG NEWS FOR BURNS UNIT OF KORL-BU

The National Petroleum Authority (NPA) has announced a project to refurbish existing wards of the Plastic and Reconstructive surgery unit of the Korle-bu teaching hospital into an ultra modern wards to improve the effective management of burns in the country.

The refurbishment which iswould cost nearly One million Ghana Cedis will turn existing wards of the BURNS Unit into an ultra modern hospital facility.

According to Mr. Asaga, refurbishment of the wards of the BURNS Unit by the NPA is to fulfil the passion and vision of President John Manama for a first class BURNS Unit to manage cases of burns and related accidents in the country.  

The Chief Exuitve of the NPA, Moses Asaga announced this at the launch of Consumer Week - 2015 in the Northern Region Capital, Tamale.

The Consumer Week launch for this year was aimed encouraging households in the three northern regions of Ghana this Upper East, Upper West and Northern to switch from using wood fuel to LPG to save the depleting vegetative cover of the Savanah.

Statistics by NPA show that the Northern Regions account for only 3% of the total national consumption of LPG.

The week-long Consumer celebration would also focus on sensitizing households on the safe handling of LPG to prevent accidents arising from unsafe handling of LPG. Statistics reveal injuries and deaths from burn related accident have been rising steadily since 2011. This is even exersibated by a poorly equipped Burns Unit to effectively deal with burn patients. The initiative by the National Petroleum Authority (NPA) to refurbish the reconstructive surgery and burns unit is therefore timely.

Monday(November,02 2015)

NPA WINS PRETIGIOUS SOCRATES COMMITTEE BEST ENTERPRISE AWARD BY THE EUROPE BUSINESS ASSEMBLY

The National Authority (NPA) and its Chief Executive, Moses Asaga have received two awards from the prestigious Socrates Committee of the Europe Business Assembly at a ceremony in the film-festival city of Cannes, France. The Socrates Committee of the Europe Business Assembly has in the last fifteen years recognized leaders in Business, science, education and culture from over twenty countries. On Monday, October 12, 2015 in the beautiful city of Cannes, France, the Socrates Committee of the Europe Assembly awarded the National Petroleum Authority (NPA) as the “BEST ENTERPRISE” for 2015 and Chief Executive, Moses Asaga as “BEST MANAGER” for the same year. The International Prize for “BEST ENTERPRISE” is for professional achievements in commercial activities and quality. The Socrates Nomination Committee nominates individuals and organizations based on recommendation from local respondents and players of the local industry. In the case of the National Petroleum Authority and its Chief Executive Moses Asaga, the Socrates Nomination Committee received recommendations from players in the downstream petroleum industry. The NPA was nominated for successfully implementing the policy of petroleum deregulation and being innovative in using cutting edge technology to improve the monitoring of petroleum product quality in the supply chain of the petroleum downstream in Ghana.
Monday(November,02 2015)

NPA WINS PRETIGIOUS SOCRATES COMMITTEE BEST ENTERPRISE AWARD BY THE EUROPE BUSINESS ASSEMBLY

The National Authority (NPA) and its Chief Executive, Moses Asaga have received two awards from the prestigious Socrates Committee of the Europe Business Assembly at a ceremony in the film-festival city of Cannes, France. The Socrates Committee of the Europe Business Assembly has in the last fifteen years recognized leaders in Business, science, education and culture from over twenty countries. On Monday, October 12, 2015 in the beautiful city of Cannes, France, the Socrates Committee of the Europe Assembly awarded the National Petroleum Authority (NPA) as the “BEST ENTERPRISE” for 2015 and Chief Executive, Moses Asaga as “BEST MANAGER” for the same year. The International Prize for “BEST ENTERPRISE” is for professional achievements in commercial activities and quality. The Socrates Nomination Committee nominates individuals and organizations based on recommendation from local respondents and players of the local industry. In the case of the National Petroleum Authority and its Chief Executive Moses Asaga, the Socrates Nomination Committee received recommendations from players in the downstream petroleum industry. The NPA was nominated for successfully implementing the policy of petroleum deregulation and being innovative in using cutting edge technology to improve the monitoring of petroleum product quality in the supply chain of the petroleum downstream in Ghana.
Wednesday(September,23 2015)

SPEECH BY CHIEF EXECUTIVE OF THE NATIONAL PETROLEUM AUTHORITY, MR. MOSES ASAGA, AT THE COMMISSIONING OF THE CENTRAL LABORATORY OF THE PETROLEUM PRODUCT MARKING SCHEME (PPMS) AT THE PREMISES OF THE GHANA STANDARDS AUTHORITY (GSA), ACCRA ON 26TH AUGUST 2015

Good Morning Mr. Chairman, Distinguished invited guests,
Members of the Press:

I am delighted to welcome you to the commissioning of the Central Laboratory for the on-going Petroleum Product Marking Scheme (PPMS) by the National Petroleum Authority.

Mr. Chairman, the implementation of the PPMS programme begun two years ago in accordance with the Legislative Instrument (LI 2187) and was formally launched in March last year.

The object of the Petroleum Product Marking Scheme (PPMS) is to ensure quality petroleum products for consumers and available statistics show that the quality of fuel on the market today is better than what prevailed before the introduction of the PPMS programme. The quality of fuel in the country today is finest in the West African sub-region and we congratulate efforts of all for this achievement.

Mr. Chairman, when the PPMS programme begun two years ago, the National Petroleum Authority promised the industry that we would sponsor the establishment of a central laboratory detached from the Authority’s control where all disputed results of fuel quality examinations would be independently verified. Today, I am pleased to announce the realization of the promise we made.

Mr. Chairman, the establishment of the central laboratory is also in conformity with the Legislative Instrument (LI 2187) governing the implementation of the PPMS. The central lab will promote fairness where dispute may arise in ascertaining the quality or otherwise of a petroleum product. Fairness is also one of the core values of the Authority as a regulator of the downstream industry. An environment of fairness and trust and in the end, we are able to achieve our collective goal of satisfying the customer.

Mr. Chairman, distinguished guests, ladies and gentlemen, the evidence show that PPMS could not have a better time. In 2013, the programme recorded violation of more than 32% at various retail outlets throughout the country. As we speak, violations has reduced from 32% to 2% signifying the effective nature of the PPMS programme. This is welcome news and we salute the effort of all especially the industry for this achievement.

Mr. Chairman, even as we outdoor the Central Laboratory, let me thank the Ghana Standards Authority (GSA) for their cooperation in making this a reality. We are also thankful for your continuous support over the years. I hope we can count on your lasting support for years to come.

Mr. Chairman, distinguished guests, ladies and gentlemen, I hereby declare the central lab of the Petroleum Product marking Scheme duly commissioned.

Thank you.
 
Tuesday(September,15 2015)

OIL MARKET NEWS (WEEK 36): WEEK ENDED 11TH SEPTEMBER, 2015

Major Highlights
  • Weekly average Brent crude oil price falls on oversupply and weak economic data
  • The weekly average GHS/USD exchange rate appreciates for the second consecutive week
  • Expectations of Saudi oil shake-up stir uncertainty
  • Ghana’s current stock of diesel decreases; petrol increases compared with the previous week
  • Diesel and Petrol imports of about 54 and 25 million Lts respectively expected by 19th September 2015
  • U.S crude oil imports down by 396,000 barrels per day from the previous week
Average Dated Brent price for the week (published by Platts) decreased by $1.21 to $47.66 per barrel from the previous week's average of $48.87 a barrel, indicating 2.49% decrease.

Brent crude oil price fell after Goldman Sachs cut its crude forecasts, citing global over-supply and concerns over the health of the Chinese economy, and after Saudi Arabia dismissed the idea of an oil producer summit. China's main indexes closed down on Monday as investors sold shares in the aftermath of a four-day market holiday, during which further restrictions on futures trading were announced.

Also weighing on prices was Japan’s revised gross domestic product (GDP) data showing its economy shrank at an annualised 1.2 percent in April-June, despite ongoing government and central bank measures to support growth.

On the supply side, Saudi Arabia is set to maintain output at around 10.2 million to 10.3 million barrels per day, near this summer's record high, in the fourth quarter as rising refinery demand offsets lower local use for power, according to industry sources. "The focus is shifting back to the still-high oversupply," Commerzbank senior oil analyst Carsten Fritsch said.

In the short term, supply will swell further from the North Sea, where crude output tracked by Reuters will rise to its highest in just over two years in October, according to loading schedules, adding to ample Atlantic Basin supplies.

Free on board (FOB) prices of petrol decreased by $14.21 to $533.85/MT from the previous week's average of $548.06, indicating 2.59% decrease; diesel decreased by $11.88 to $458.25/MT from the previous week’s average of $470.13, indicating 2.53% decrease; while LPG increased by $31.50 to $344.00/MT from the previous week’s average of $312.50, indicating 10.08% increase, during the period under review.

The average GHS/US Dollar exchange rate appreciated significantly, compared to the previous week. The appreciation of the Ghana Cedi against the USD is expected to decrease the impact of exchange rate in the determination of prices of petroleum products resulting in reduced ex-pump prices, all other things been equal.

The GHS/US Dollar exchange rate for the period 7th - 11th September 2015 was 3.7204 compared to 3.7733 for the previous week (1.40% appreciation).

Geopolitics

A shake-up of Saudi Arabia's oil leadership by King Salman has introduced a new element of unpredictability to its energy policymaking at a moment when Riyadh is grappling with slumping crude prices and its war in neighbouring Yemen.

State oil giant Aramco has been without a permanent chief executive since April, when Khalid al-Falih was made health minister, and the old Supreme Petroleum Council, where energy policy was historically made, was abolished in January.

While the world's top crude exporter has always prized stability and consistency in crafting oil policy, the changes, alongside a shift in market strategy that contributed to the world price slump, have left analysts and traders guessing as to King Salman's long-term vision.

Inventories

Ghana’s current stock of Diesel and Petrol to last 3.5 and 2.8 weeks respectively (as at 14th September, 2015). Diesel’s current stock of 3.5 weeks-to-last, decreased when compared to last week’s stock-to-last of 3.9 weeks, while petrol’s current stock of 2.8 weeks-to-last, increased when compared to last week’s stock-to-last of 2.7 weeks.

According to the import schedule, diesel of about 54 million litres is expected for delivery, while petrol of about 25 million litres is expected for delivery to add to existing stockpiles for the market.

LPG of about 5.0 million kilogrammes is also expected for delivery by close of the week (19th September, 2015). The CDU and RFCC units are both shutdown due to lack of crude and total utility failure respectively.

The statistical arm of the U.S. Department of Energy, the Energy Information Administration (EIA), in its Weekly Petroleum Status Report for week ended 4th September, 2015 reported that U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 2.6 million barrels to 458.0 million barrels.

Total motor gasoline inventories increased by 0.4 million barrels to 219.3 million barrels. Inventories of distillate fuel, a category including heating oil and diesel, increased by 1.0 million barrels to 234.1 million barrels over the same period.

Propane/propylene inventories rose 0.2 million barrels last week and are well above the upper limit of the average range. Total commercial petroleum inventories increased by 3.2 million barrels last week.

Demand and Supply

The EIA in its Weekly Petroleum Status report for week ended 4th September, 2015 reported that, U.S. crude oil imports averaged about 7.5 million barrels per day last week, down by 396,000 barrels per day from the previous week.

Over the last four weeks, crude oil imports averaged over 7.6 million barrels per day, 0.5% above the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 589,000 barrels per day. Distillate fuel imports averaged 130,000 barrels per day last week.

The US EIA reduced its demand forecast for oil and refined products for the first time this year on the back of slowdown in China and its implications for the rest of Asia. The agency still expects consumption to increase by 1.3mbd from this year to next, rising to 94.93mb/d, however this is down from the 95.08mb/d they had forecast last month.

Russia, the world's top oil producer, may increase its oil output by 1 percent this year, Energy Minister Alexander Novak was quoted as saying by Russian news agencies on Wednesday.

"This year, we expect output in line with last year, maybe (even) with a moderate growth of around 1 percent," Novak was quoted as saying by Interfax news agency.

Russia has been pumping near post-Soviet highs of around 10.7 million barrels per day of oil over the last couple of months despite low oil prices, as weak rouble is offsetting losses.

References
  • www.reuters.com
  • Barclays Oil Update
Thursday(August,27 2015)

LAB TO ENSURE UNADULTERATED PETROLEUM PRODUCTS INAUGURATED

 A central laboratory has been set up to facilitate the testing of all petroleum products meant for the local market to ensure that they are not adulterated.

The laboratory, located on the premises of the Ghana Standards Authority (GSA) at Okponglo in Accra, will ensure that all petroleum products to be sold locally are of good and acceptable quality to promote safety.

The set-up is a collaboration between the GSA and the National Petroleum Authority (NPA) in support of the implementation of the petroleum products marketing scheme instituted in 2014.

The scheme is a system that allows the NPA to identify adulterated products on the market.

Value for money

In a speech read on his behalf at the inauguration of the laboratory yesterday, the Chief Executive Officer of the NPA, Mr Moses Asaga, said the initiative would boost the operations of the petroleum industry and ensure that consumers were given value for their money.

He said the laboratory, being independent of the NPA, would ensure fairness in the testing of petroleum products for all members of the association of oil marketing companies (OMCs).

That, he added, would solidify the trust industry players and prospective industry players had in the NPA.

In his welcome address, the acting Executive Director of the GSA, Mr Kofi Nagetey, said it was the mission of the authority, as the national standards body, to promote standardisation for the improvement of the quality of goods and services, as well as ensure sound management practices in local industries and public institutions.

“This explains why we collaborate with all regulatory bodies in the country to achieve the national goal of ensuring safety and the quality of all products to safeguard the environment and public health,” he said.

Self-test system

The Industry Coordinator of the OMCs, Mr Kweku Agyeman-Duah, applauded the NPA and the GSA for the initiative.

He, however, appealed to the NPA to put in place a mechanism that would enable the operators to test the quality of petroleum products at their marketing outlets.

Source: Graphic
 
Monday(June,15 2015)

PETROLEUM MINISTRY PRESENT GHC1.45M TO SUPPORT FLOOD, FIRE VICTIMS

The Ministry of Petroleum on Thursday donated GHC1, 450,000 to be used towards the purchase of relief items to be distributed by the National Disaster Management Organisation (NADMO) among victims of the June 3, flood and fire disaster in Accra.

Contributed by four subsidiary agencies under the ministry namely; National Petroleum Authority (NPA), Ghana National Petroleum Corporation (GNPC), Bulk Oil Storage and Transportation (BOST) and Ghana Oil (GOIL), it was also meant to help ease the suffering of the people.

Commenting, the Petroleum Minister, Emmanuel Armah-Kofi Buah who led a delegation from the sector said that the devastating effects of the floods needed joint efforts, hence the gesture to help those affected.

While commiserating with the bereaved families and the affected, he reemphasized the ministry’s pledge to assist in any possible way to ease the pain on various fronts as a result of the national tragedy.

Receiving the cheque, the National Coordinator of NADMO, Brigadier-General Francis Vib-Sanziri said the tragic event of June 3, directly or indirectly affected all Ghanaians.

He said it was, therefore, important for all Ghanaians to form a united front to address all challenges that had emanated from the tragic event.

The NADMO boss said he would continue working with government and other partners to ensure safe passage and distribution of supplies to the affected communities.

Also present at the ceremony were the Chief Executive Officer of NPA, Moses Asaga, the Managing Director of BOST, Kingsly Kwame Awuah-Darko and  Senyo Hosi, CEO of Ghana Chamber of Bulk Oil Distributors.
Thursday(June,11 2015)

PETROLEUM MINISTER INSPECTS FILLING STATIONS IN ACCRA

The Minister of Petroleum, Emmanuel Armah   Kofi Buah, has urged filling station managers to constantly provide training for filling station attendants. This, he says, will enable them to upgrade their skills and expertise on safety standards in order to forestall any disaster.

He also asked the National Petroleum Authority (NPA) to go beyond periodic inspections of safety standards and ensure that filling stations do not compromise on safety standards on daily basis.
The minister said this when he visited some filling stations in Accra to ensure that their operations met the required standards set by the NPA.

He was accompanied on the tour by officials of the NPA including the Chief Executive, Moses Asaga and the Chief Inspector of the Authority, Esther Anku.

The stations they visited were the Total Filling Station opposite the La Palm Hotel at La, and the Goil  Filling Station at the 37 Military Hospital.

The visit came in the wake of the explosion in the midst of the flood at the Goil Filling Station at Circle on June 3 which led   to the death of over 100 people and injuries to others who had sought shelter at the filling station, as well as damage to properties wealth million of cedis.

Though the cause of the explosion is yet to be established, it is believed that safety standards may have been compromised, resulting in the inferno in the midst o f the heavy rain pour.

Mrs Anku briefed the minister at the filling stations on the safety standards inspection check list which is used by the NPA to score the filling station on general information about the filling station, underground storage tanks, and regulatory requirements such as Environmental Protection Agency Permit, NPA Licensing Permit and Ghana Standards Authority Permit.

Other requirement on the check lists are technical requirements such as distance of the outlet from medium and high voltage lines, conditions of dispensing nozzles, infrastructure requirements, waste management storage and disposal, pollution prevention and control, occupational health and safety and other housekeeping duties.

Even  though  the fillings stations visited appeared to have met the requirement, Mr Buah stressed on the need to go beyond the regular  by ensuring that on daily basis they complied with the standards and not only  during official visits.

Mr Buah said the ministry together with the NPA were “taking a second look” at the safety regime for filling stations to ensure that “we identify lapses in the current regime so that we tighten the loose ends so that we do not compromise on safety.”

He said the ministry was working with other agencies and stakeholders to adopt a “coordinated approach” in addressing safety standards at filling stations to avoid any further disasters.

Mr Buah advised the workers at the filling station to strictly adhere to the safety standards adding “you need to have on daily basis all the things you need in your operations so that we do things right there should be no excuses.”

Mr Asaga assured that the NPA had a “robust safety standards” as a regulatory authority and would not compromise in its monitoring role to ensure that the filling stations adhere to the standards.
Tuesday(June,02 2015)

Govt to wash hands off pricing of petroleum products

The government has decided to wash its hands off the pricing of petroleum products.

This means that the Bulk Oil Distribution Companies (BDCs) and Oil Marketing Companies (OMCs) will, before August 2015, price their own products.

The strategy, which is the final phase of Ghana’s petroleum downstream deregulation policy, will result in the cessation of subsidies on fuel products.

The government’s indebtedness to the BDCs as a result of subsidies currently stands at more than $800 million.

The Chief Executive of the National Petroleum Authority (NPA), Mr Moses Asaga, in an interview with the Daily Graphic in Accra Monday, clarified that “the increment or decrease of petroleum prices will no longer be the preserve of the government but will be determined by market forces that will take into consideration the international price of crude oil, the foreign exchange rate, the fall or rise of the cedi, import duties, taxes and other factors.

“This means the government will no longer be involved in the pricing of petroleum products and therefore the perennial issue of subsidies will come to an end,” he said.

Rationale

Explaining the rationale behind the liberalisation of the petroleum downstream sector, Mr Asaga told the Daily Graphic that the full implementation of the deregulation of the petroleum downstream sector would promote competition among market players.

“Prices will vary and will be lower because the BDCs and the OMCs will be competing with one another for a wider market share. The petroleum downstream sector will in no time turn out like the telecoms sector, where there is so much healthy competition.

“The issue of colossal subsidies which put a huge financial burden on the government, he said, would also end and thereby result in the re-channeling of finances into other sectors of the economy, Mr Asaga said.

Timeline

Mr Asaga did not give a specific date by which the new policy would be implemented but said it would be implemented before August 2015.

According to him, the NPA was currently holding meetings with stakeholders, including the BDCs, the OMCs and transporters.

“We have met the BDCs and scheduled a meeting with the OMCs this week. Some portions of the NPA Act will have to be slightly amended to contain the new situation or pricing,” he said

Sanctions

Touching on moves to ensure that consumers were not short-changed, he said: “There will be sanctions on BDCs and OMCs that will go beyond the average price indicated. The punishment will be the suspension of operating licences. In the event that the quality of products is found to have been compromised, it will result in the withdrawal of licences after a third warning.”

He said the Petroleum Product Market Scheme (PPMS) Unit, which was set up at the NPA two years ago, “will be strengthened to become a very strong department in the new dispensation to further do away with incidents of adulteration and sale of inferior products.

“The failure rate or quality, which used to be 30 per cent of product quality, has been reduced to two per cent since the introduction of the PPMS. We will tighten it to 0.5 or 0.1 per cent,” he added.

Debt

On the debt the government owed the BDCs, Mr Asaga said, “We hope to isolate this debt and deal with it once and for all.”

He said Nigeria was currently facing acute fuel shortage because of debts the government owed the BDCs there, adding that in the case of Ghana, “we have managed the system prudently to forestall product shortages so far”.

Control

He explained that Cabinet was aware of the new measure and further indicated that there were checks and balances in place to ensure that the interests of consumers were protected.

“The NPA will make sure that prices quoted by the BDCs and the OMCs are within the approved and expected ranges. We will make sure they do not take undue advantage of the consumer.

“Each OMC will have to indicate its ex-pump price and it is expected to submit it to the NPA for publication. This will enable consumers to have a choice, depending on the price of products,” he said.

Quality

Asked how the NPA would ensure that the quality of products was not compromised, Mr Asaga said: “The NPA will tighten its quality control measures to ensure that the inspection and testing of petroleum products meet the standard specification of the NPA and the Ghana Standards Authority (GSA) before they are discharged at the port.”

History

The deregulation of the petroleum downstream sector started with the establishment of the NPA, which decided to deregulate the industry that used to be controlled by the Tema Oil Refinery (TOR), the Bulk Oil Storage and Transportation (BOST) Company Limited, the Ghana National Petroleum Corporation (GNPC) and a few multinational companies.

The BDCs were introduced in the process. 

They were initially four, but the number has now increased to 27.

The OMCs, which were less than 10 some decades ago, have increased to 120, out of which 70 per cent control the retail market.
Thursday(May,21 2015)

NPA FREEZES OPENING OF NEW FUEL STATIONS

  The National Petroleum Authority (NPA) has suspended the issuance of permits for the construction of new retail outlets for petroleum products across the country.

This is because the NPA is in the process of auditing the permits issued to various petroleum service providers (PSPs) to construct petroleum product retail outlets and LPG refilling plants.

The suspension takes retroactive effect from May 1, 2015.

Speaking at this year’s petroleum downstream industry meeting held in Accra, the Chief Executive Officer (CEO) of the NPA, Mr Moses Asaga said “the audit will culminate in the revision of the requirements for the grant of construction permits for such facilities”.

He explained that “the suspension will affect all applications submitted to the authority from the said date.
Applications that were received before May 1, 2015, but had incomplete documentation will be affected by the suspension.”

Mr Asaga told the packed room that the rationale behind the new directive was to ensure that sanity prevailed in the operations of PSPs.

“The growing numbers of filling stations in the country has to be looked at again. Presently there is an uneven spread of filling stations in some parts of the country. Take the northern border towns for instance, between Paga and Bolgatanga, there are 20 filling stations alone and we all know that there are no massive commercial activities in those towns,” he said.

Asked how long the suspension will be in force, Mr Asaga said the timeline was not known immediately. 
“We are in talks with the Centre for Remote Sensing and Geographic Information Services (CERSGIS) to complete a map of filling stations and their respective locations. 

We currently have the co-ordinates of all existing filling stations and are in the process of developing them into geographic information systems with pictorial maps of the retail outlets,” the CEO of NPA said. 

Those measures, he said, would inform the NPA to take the necessary measures to prevent the proliferation of filling stations in certain areas. 

He said it was important for the NPA to take stock of the activities of PSPs to ensure all laws were complied with.

According to Mr Asaga, the safety of Ghanaians was also taken into consideration before arriving at that decision.

“The NPA had sent a circular to all stakeholders on the new decision and would duly inform them when the exercise ends,” he said.

Touching on other issues, Mr Asaga commended “each and every one of the industry players for their role in sustaining our industry in the past year despite the numerous challenges.

The BDCs and BOST have held the fort in ensuring products importation to cover TOR production challenges, the transporters have efficiently distributed products especially in times of shortages, and the OMCs have improved upon the delivery of quality products much more efficiently at the pump.”
Sunday(May,10 2015)

NPA ORGANISES BLOOD DONATION EXERCISE

The National Petroleum Authority (NPA) has organised a blood donation exercise at its head office in Accra.

The programme was undertaken in collaboration with the National Blood Service at Korle-Bu Teaching Hospital, to stock the hospital’s blood bank.

More than 40 members of workers of NPA voluntarily donated blood after the necessary medical checks had been performed on them.

Speaking to the media, the Public Relations and Consumer Service Manager of the National Petroleum Authority, Yaro Kasambata, said the exercise was the maiden one by the Authority and was aimed at encouraging people to donate blood to the National Blood Service to save lives.

“We want to donate to save lives. We have estimated 60 volunteers and if by the end of the day we are able to receive 30 to 40 pints of blood, that will be a tremendous success,” he said

Mr. Kasambata indicated that the exercise would be made an annual affair.

He added that the exercise was part of activities to mark the 10th anniversary celebration of NPA in June, 2015 and encouraged the public to make blood donation a habit and part of their lifestyle.

A principal blood donor recruiter of the National Blood Service, Mr David Dodzi Ahiadzro, told the DownstreamToday that his outfit was in dire need of blood.

According to him, “demand outweighs supply. Our target of 250,000 per annum has never been met.

The closest we get to is 38 per cent voluntary donation which translates to about 85,000 units of blood.”

Mr. Ahiadzro commended NPA for the initiative, urging other organisations to emulate their example to help save lives.

“Although the expected units of blood were not met, the exercise was successful”, he added.
 
Source: PR/CS
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