CSOs to name and shame BDCs and OMCs engaged in illegal activities in Ghana’s Petroleum Downstream*

The Office of the Special Prosecutor (OSP) recently executed coordinated searches at five major fuel depots, seizing documents and electronic materials as part of a probe into the under-declaration of petroleum imports and falsification of product types. before this raid, the OSP’s 2nd half year report also indicated that one Bulk Oil Distribution Company and 16 Oil Marketing Companies (OMCs) were engaged in diversion of condensate and marine gasoil, in which case GH¢8.5 million was recovered by the OSP.

The magnitude of the discovery and expose’ in Ghana’s petroleum downstream by Office of the Special Prosecutor underscores the commercial and organized scale of illegal activities in the sector. the recent pronouncements demonstrate that the illegal activities are not limited to fuel diversion but also under-declaration of petroleum imports, falsification of product types during depot transfers, and tax evasion.

The financial impact of these illicit activities on the Ghanaian state is staggering. Ghana loses about Ghc2 billion annually through tax evasion in Ghana’s petroleum downstream. Further, Ghana spends about Ghc680 million annually to subsidize premix for fishermen yet much of these subsidies and the product rarely gets to their intended beneficiaries.

The OSP’s preliminary findings suggest that these losses are not merely the result of clerical errors but of deliberate, criminal collusion. The recent investigations reveal secret partnerships between Bulk Distribution Companies (BDCs) and officials within the National Petroleum Authority (NPA), Ghana Revenue Authority (GRA), and even the National Security Secretariat. These intermediaries facilitate illicit financial transfers and the falsification of product types during depot transfers, allowing companies to import high-tax fuels while declaring them as lower-tax alternatives.

Conclusion
The recent expose’ by the Office of the Special Prosecutor is alarming and increasing the loss of revenue to the government. In this regard, Institute of Energy Policy and Research and Center for Environmental Management and Sustainable Energy in the coming weeks will begin a name and shame campaign of BDCs and OMCs, in a collaborative effort to support the OSP win-off the petroleum downstream from illegal activities that negatively affect government revenue.

By Benjamin Nsiah
Executive Director, CEMSE