The newly established Sentuo Oil Refinery Limited stands to receive the highest tax exemption among 42 companies if Parliament approves a request for exemptions totalling $335,072,712.13 under the government's One District One Factory (1D1F) initiative.
The proposed tax exemption for Sentuo Oil Refinery amounts to $164,633,012.00.
The tax exemption proposal, initially presented to Parliament in 2022 by former Finance Minister Ken Ofori-Atta under The Exemptions Act, 2022 (Act 1083), has sparked significant debate.
The proposal has led to a deadlock in Parliament, with opposing views on the request for exemptions.
The Minority in Parliament has raised concerns about the potential for corruption, suggesting that the exemptions may be a means for the ruling government to benefit their allies and cronies.
Conversely, the Majority argues that tax exemptions are crucial for businesses participating in the 1D1F initiative to thrive, thereby boosting economic growth and attracting significant investments into the economy.
On May 17, 2024, the Majority reintroduced the request for tax exemptions to Parliament for consideration.
In the meantime, Sentuo Oil Refinery Limited, Ghana's first private oil refinery, was commissioned by President Nana Addo Dankwa Akufo-Addo on January 26, 2024.
The refinery, built by the Sentuo Group, a Chinese conglomerate based in the Tema Industrial Area, represents a $2 billion investment.
Initially, the refinery will process 40,000 barrels of oil per day, with plans to scale up to 100,000 barrels per day once fully operational. It is expected to reach a production capacity of five million barrels per year.
Despite the promising development, two Ghanaian energy institutions, the Institute of Energy Security and the Chamber of Petroleum Consumers, called for the National Petroleum Authority to shut down the Sentuo Oil Refinery in February.
They argue that the refinery has not yet been licensed to distribute fuel in the Ghanaian market.
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