Chief Executive of the National Petroleum Authority (NPA) Dr. Mustapha Abdul-Hamid has disclosed that Ghana’s petroleum downstream industry had an annual sales value of about GH¢32.94 billion in 2021 and contributed 7.2% of the country’s GDP.
The increased demand for the petroleum products, he noted, represented a 41% surge in the use of fossil fuels as compared to 2020.
This, according to him, is an unprecedented surge in consumption of these products when the annual average over the years had been between 5% and 7%.
The increase in consumption, the NPA Boss pointed out, was as result of various technological based schemes and interventions being implemented by the downstream regulator to curb illicit fuel activities over the past few months.
Dr. Abdul-Hamid disclosed these when he delivered a welcome address at the 2022 Ghana International Petroleum Conference (GhIPCon) on Wednesday. The 2022 GhIPCon is on the theme- “Energy Transition in the African Petroleum Downstream Context: Prospects, Challenges and the Way Forward”.
Dr. Abdul-Hamid observed that the downstream petroleum sector is entering a new era as the world looks to accelerate its transition away from fossil fuels.
According to him, much of the world is exposed to the global energy transition as countries continue to depend on oil and gas revenues.
He stated that Energy Transition is the pathway towards transformation of the global energy sector from fossil-based fuel to zero carbon and every country on earth is obliged, under the Paris Agreement, to reach this net zero emissions in the second half of this century.
However, Dr. Abdul Hamid observed that the reality of fulfilling this energy transition commitment is, putting pressure on government spending to ensure the diversification process meets global needs.
“It is therefore imperative that we intensify our efforts. But it is not just about the pace of change. It is also about the scale of change.
“Every country, every sector, and every company has announced its ambition to be a Net Zero Emissions energy company or society by 2050 or sooner”, he added.
Ghana, he said, is one of the few African countries that consumes low Sulphur fuels, with a roadmap for local refineries to comply.
Dr. Abdul-Hamid also reiterated the country’s commitment to reducing the emissions from consumption of energy products.
“We at the National Petroleum Authority are committed to reducing the emissions from the energy products we consume in Ghana, and this culminated to the reduction of sulphur content in transport and industrial fuels from a maximum of 5000ppm to a maximum of 50ppm.
“As previously mentioned, Ghana is one of the few African countries that consumes low Sulphur fuels, with a roadmap for local refineries to comply,” he said.
CRM policy
Dr. Abdul-Hamid reiterated government’s determination to make the Cylinder Recirculation Model policy a reality and indicated in the entire sub-region, it is only Ghana and Nigeria that still operate LPG filling stations and ought to move with the time and to achieve LPG penetration of 50% by 2030.
The NPA Boss stated that government regulations play a vital role in accelerating the energy transition, stressing that regulations and incentives lead to greater innovation that in turn allows companies to commercialise more rapidly their low and zero carbon solutions.
He noted that the demand for transportation fuels will wane over the longer term or decline rapidly depending on policy and technology innovation.
Downstream investment and operating strategies, the NPA Chief Executive indicated, must therefore account for the fundamental shift in regulations and demand trends.
Dr. Abdul-Hamid further charged participants at this year’s conference to deliberate on the key issues with a focus to devise strategies for deployment.
Energy transition
Speaking on behalf of the Energy Minister, a Deputy Minister of Energy, William Owuraku Aidoo, said Ghana remains committed to an energy transition agenda and the development of the petroleum industry.
“Ghana remains committed to both an energy transition agenda and the development of its petroleum industry, including downstream sector, we believe that the way forward is to strike an important and fair balance between the two without compromising our determination to maximize the benefits we need for our industrialization.
“I am convinced beyond measures that the conference will provide significant outcomes to guide us on the way forward, and I look forward to further engagements in this direction,” he added.
He further charged players in the West Africa Sub region to improve refinery capacity to produce high-quality fuels to reduce Green House Gas emissions.
The three-day conference is organized by the National Petroleum Authority (NPA) in collaboration with the African Refiners and Distributors Association (ARDA) under the auspices of the Ministry of Energy and the Ghana Chamber of Bulk Oil Distributors (CBOD).
It attracted major players including CEOs, experts and decision makers in the petroleum sector across the West Africa Sub Region.
