Acting Managing Director of Tema Oil Refinery’s (TOR), Edmund Kombat has disclosed that the company’s entire debt stock as of December 2024 was $517 million.
He attributed this to a combination of government accounting changes and operational liabilities.
Speaking to journalists following a presentation before Parliament’s Energy Committee, he noted that trade obligations and unpaid crude oil supplies over the years were responsible for a significant portion of the debt.
He also revealed that the government’s continuing arrangement with the International Monetary Fund (IMF) had resulted in the reclassification of several grants originally given by the Ministry of Finance as debt, which contributed to the increase in TOR’s outstanding debts.
“We are doing that verification, and as I mentioned, once we do that verification and authentication of what we have been able to bring down, that will be communicated publicly.
“So what occasioned it trade debts, sometimes third parties. And then there were also debts that are legacy debts where crude was supplied, it was not paid. There were times that the Ministry of Finance in the past had given some funds to TOR. Some of it for example was grant and then when they entered into the IMF, the IMF asked them to reclassify it as debt. So those things have accumulated to that amount of money. And I think that the last time TOR traded, some of the trade were not hedged and so there was a lot of exposure which led to a lot of debt ballooning,” he stated.
According to the acting TOR MD, his administration would make sure that the exposure that resulted in the large debts doesn’t happen again.
“But we are here to make sure that that is stopped and it is not repeated,” he assured.
Edmund Kombat appeared before the Parliamentary Committee on Energy together with other officials of TOR to brief the Committee on their mandate, work plans for the year 2025 as well as their operational challenges.
Earlier, he announced that the refinery is expected to resume full operations by October 2025, following a lengthy shutdown due to lack of crude.
TOR has also initiated steps to revive its key production infrastructure, including the Crude Distillation Unit (CDU) and the Residue Fluid Catalytic Cracker (RFCC).
The Residue Fluid Catalytic Cracker (RFCC) had not been operated since 2019, and since 2021 the Crude Distillation Unit (CDU) had also not run which his administration has assessed to determine their readiness and possibility of bringing it back.
“After assessing the plant, we realised that the plant was in good shape and that with a few technical works we could get the plant back and that is what we have been seriously working on.”
