The government of Ghana has appointed a transaction adviser to help raise funds to pay half of the US$600 million owed by the Tema Oil Refinery (TOR) to Ghana Commercial Bank (GCB).

This would enable the bank to provide the letters of credit (L/Cs) TOR needs to purchase crude oil for Ghana's only refinery.

Debts

GCB has said it would issue L/Cs for crude oil imports provided TOR makes a part payment of at least US$300 million against its debts.

Apart from its debt to GCB, the refinery also owes around US$240 million to the Volta River Authority, Bulk Oil Storage and Transport and the Electricity Company of Ghana.

Government resolve

Now the government is resolved to clear TOR's balance sheet, since no banks will, at the moment, issue L/Cs to TOR.

The current government says it is not responsible for TOR's indebtedness but apparently realises it needs to intervene so that L/Cs and crude oil imports can start flowing once more.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.