The management of the Tema Oil Refinery (TOR) has strongly denied corruption allegations against Tema Energy Processing Limited (TEPL), the company selected to rehabilitate the refinery’s infrastructure and engage in refining activities.
According to TOR management, the allegations are unfounded, and the lease agreement between TOR and TEPL was executed in good faith, proving to be a beneficial deal for the revival of the facility.
However, the decision to offer the refinery to TEPL faced strong opposition from the TOR Workers Union.
Represented by the General Transport, Petroleum, and Chemical Workers Union, the workers petitioned the Office of the Special Prosecutor (OSP) to investigate the agreement.
As a result, the OSP directed TOR to suspend the proposed partnership agreement.
Addressing the concerns raised, the management of TOR assured the workers that the transaction with TEPL would ultimately benefit them and improve their living conditions.
David Kwame Tandoh Adomakoh, the Board Chairman of TOR, emphasized that while the refinery had been open to other investors, TEPL was the only company willing to help alleviate TOR’s debt within the six-year lease period.
Adomakoh stated, “Most of the likely candidates don’t have an interest… It’s not an easy place to make something like this work.”
He debunked claims that the TOR Workers’ Charity Fund would only benefit selected workers and clarified that the intention behind creating TEPL was to establish a Workers Charitable Trust. This trust would allow all TOR workers to benefit from the lease arrangement.
TEPL, formerly known as Decimal Capital and Torentco, is the result of a joint venture between Torentco, CAD investment, and the TOR Workers, with each holding a 40 percent and 20 percent share, respectively.
In terms of the partnership agreement, TOR has the right to terminate the contract without cause if TEPL fails to meet its payment obligations. Under the agreement, all employees will remain in the employment of TOR, while TEPL provides technical supervision over the operations and maintenance of the leased assets.
The benefits for TOR in this proposed transaction include the retention of its revenues, estimated at approximately USD 4 million per year, as well as dividends from GPMS amounting to around USD 8 million. The agreement also allows for realistic prospect of annual salary increases for TOR employees, addressing the decline in real terms over the past five years.
Additionally, this partnership enables TOR to structure realistic payment plans to address its statutory debt and other commercial liabilities.
The estimated total investment in TOR’s fixed assets and infrastructure over the lease term is about USD 50 million. TOR also has the flexibility of an Early Buyout Option, ensuring the ability to explore other commercial arrangements without being locked in for the entire lease term.
Furthermore, TEPL brings together a dedicated group of leading energy TOR rehabilitation companies, supported by the world’s leading oil trader, to successfully deliver on the rehabilitation of TOR. This transaction aims to refurbish and improve TOR’s infrastructure, restoring the refinery to profitability and sustainability. It also focuses on the development and training of key core skills, including a return to annual graduate employment and training, as well as restoring staff morale, pride, working conditions, and benefits.
In conclusion, the management of TOR remains steadfast in refuting the corruption allegations against TEPL. They continue to maintain the integrity of the lease agreement and emphasize the potential benefits it holds for TOR workers and the overall revival of the refinery.
By Vincent Kubi