BOST reviews oil supply terms to free up public funds
The Bulk Oil Storage and Transport Company (BOST) Limited has reviewed the terms of accessing oil supplies by traders on the international market to prevent marketers from holding onto public funds.
Currently, the company is owed an accumulated amount of GH¢36,835,313 in export sales by some international companies.
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The amount, which has been outstanding since December 2016, came about as a result of international companies buying petroleum products from Ghana to sell on Sahelean markets.
Besides the debt from export sales, there are also outstanding storage and rack fees owed by some local companies, amounting to GH¢4,987,955.85.
Speaking to the Daily Graphic in Accra on Thursday, the Managing Director of BOST, Mr Alfred Obeng-Boateng, said a review of oil supplies had led to the introduction of non-credit export sales of petroleum products
He said on the local front, BOST had also introduced the prompt payment of storage and rack fees.
That meant that distribution companies had to make down payments to BOST before being allowed to store their products in BOST depots, he said.
Previously, local distribution companies stored their products in BOST depots on credit, a development that led to 11 of them currently owing the company GH¢4,987,955.85
“The measures we have taken to right the wrongs of the past have far-reaching benefits to the state in terms of revenue,” he said.
Mr Obeng-Boateng explained that the debts were inherited from his predecessor administration and gave an assurance that the current management would do everything possible to retrieve the outstanding debts.
Export regime
BOST began exporting petroleum products by road from its Bolgatanga Fuel Storage and Distribution Depot to the Sahelean countries of Burkina Faso, Niger and Mali in 2015. The company also exports products by sea to Liberia.
The objective of entering the international market was to raise more revenue for the country, boost trans-ECOWAS trade and open up employment avenues for Ghanaians, particularly those in the Upper East Region from where the petroleum products are transported by road to the Sahelean market.
By the agreement, BOST sold the petroleum products to international bulk distribution companies on credit.
However, some of the companies failed to pay back, resulting in the accumulated debt.
Steps taken
Explaining the steps taken so far to retrieve the money from the four debtor companies, Mr Obeng-Boateng said they had been given a specific period to pay back or “we start to seize their products to defray the debts”.
He said failure to pay for the products affected the finances of BOST.
He further disclosed that the practice where bulk distribution companies picked petroleum products directly from Tema to the Sahelean countries had been discontinued.
The arrangement now, he said, was that petroleum products meant for export to land-locked countries were sent to the BOST depot in Bolgatanga, from where the companies would pick up their products to their final destinations.
He said the measure was to prevent possible cheating by unscrupulous companies through the diversion of the products onto the domestic market and contamination of products.