The Institute for Energy Security (IES) has cautioned that the revival of the Tema Oil Refinery (TOR) could lose momentum if the refinery continues to depend on irregular and negotiated crude oil allocations.
In a policy research paper, the institute said TOR’s return to refining operations following turnaround maintenance was an important development, but argued that the refinery’s long-term success would depend largely on securing a steady and predictable supply of crude.
The IES noted that Ghana had already begun negotiating crude allocations for TOR, including a reported one-million-barrel allocation of Jubilee crude. However, it said such arrangements should not become a substitute for a formal and recurring Domestic Market Obligation (DMO) system.
The institute pointed to existing petroleum legislation as providing the legal basis for establishing a more dependable crude supply mechanism for domestic refineries.
Under Section 71 of the Petroleum (Exploration and Production) Act, 2016 (Act 919), the sector Minister may require petroleum contractors to sell part of their crude entitlement to meet domestic supply requirements.
The IES also cited Regulation 32 of L.I. 2359, as amended by L.I. 2390, which provides for the calculation of domestic crude obligations, including annual and monthly requirements, delivery arrangements and pricing.
According to the institute, the return of TOR provides an opportunity for government to consistently apply these provisions rather than rely on individual crude allocations.
TOR completed turnaround maintenance on its Crude Distillation Unit in October 2025 and resumed refining operations in December.
The refinery is currently reported to be processing about 28,000 barrels per stream day, compared with its nameplate capacity of 45,000 barrels, with plans for further expansion.
The IES warned that restoring the refinery’s physical infrastructure would not be enough if TOR could not secure sufficient feedstock to operate consistently.
It cited developments at Nigeria’s Dangote refinery as a cautionary example, noting that inadequate crude supplies have at times compelled the facility to source additional crude from international markets using US dollars.
The institute said Ghana could face similar challenges if domestic crude allocations to TOR are insufficient or unpredictable.
It therefore recommended that any DMO arrangement should be directly linked to TOR’s actual throughput requirements and adjusted as the refinery’s processing capacity expands.
The IES further cautioned against treating the domestic crude obligation as merely a symbolic policy intervention, stressing that inadequate volumes would undermine the purpose of the arrangement while potentially exposing local refiners to foreign-exchange pressures.
IES proposes structured supply calendar
To address the challenge, the institute is calling on government to issue the 90-day notices required under Regulation 32 and establish a recurring calendar-year system for domestic crude supply.
It also wants annual domestic crude requirements to be clearly published and broken down into monthly allocations.
According to the IES, greater certainty would enable crude producers and refiners to plan their operations more effectively and reduce the risks associated with unpredictable feedstock availability.
The institute believes a shift from discretionary crude allocations to a structured and predictable supply system is essential if Ghana is to fully realise the benefits of TOR’s revival and build a more reliable domestic refining industry.
