Ghana’s growing refining capacity will improve fuel security but cannot yet fully shield the country from global petroleum market shocks, Benjamin Nsiah, an energy expert, has said.  

He said local refineries operating at full capacity could meet about 60 per cent of current domestic petroleum demand, leaving the country dependent on imports for the remainder.  

Mr Nsiah, Executive Director of the Centre for Environmental Management and Sustainable Energy (CEMSE), made the observation in an interview with the Ghana News Agency in Accra.  

He said Ghana currently consumed between 120,000 and 140,000 barrels of petroleum products daily, making investments in local refining infrastructure important to strengthening energy security.  

“At full capacity, looking at our current consumption of about 120,000 barrels a day to 140,000 barrels a day, they are likely going to do about 60 per cent of our daily demand,” he said.  

Mr Nsiah therefore disagreed with suggestions that the operationalisation of new refineries alone would completely insulate Ghana from international fuel price fluctuations.  

He said the country’s petroleum pricing regime remained exposed to international market developments because a significant proportion of refined petroleum products was still imported.  

Mr Nsiah noted that under the deregulated pricing system, pump prices were largely influenced by international refined petroleum product prices, the exchange rate of the Ghana cedi against the United States dollar, freight and insurance costs, and statutory taxes and levies.  

He said fluctuations in global oil prices and foreign exchange rates could therefore continue to affect domestic fuel prices despite efforts to expand local refining capacity.  

Mr Nsiah said recent developments in both state-owned and private refineries offered prospects for increased domestic production.  

He cited the Tema Oil Refinery (TOR), which recently announced a profit after tax of GH¢1.24 billion amid reforms aimed at strengthening its operations and contribution to national energy security.  

Mr Nsiah said planned expansion projects by local refining companies could significantly increase domestic output and potentially enable Ghana to meet its entire fuel requirement.  

“If they are able to do, as TOR has proposed, about an additional 100,000 barrels, and Sentuo is also adding, then these two companies will likely be able to exhaust our daily demand and even export,” he stated.  

Mr Nsiah said achieving such capacity would put Ghana on a stronger path towards petroleum self-sufficiency and could enable the country to export petroleum products within the West African sub-region.  

He also recommended that Ghana gradually recalibrate its petroleum pricing framework as domestic refining capacity expanded to reflect local refinery costs and operational realities.  

Mr Nsiah said a stronger domestic refining industry would create an opportunity to reduce dependence on international pricing benchmarks that significantly influence fuel prices.  

He said the long-term objective should be to build a resilient petroleum sector that ensures fuel availability while reducing the impact of external market disruptions on consumers and businesses.