A member of Parliament’s Mines and Energy Committee, Edward Bawa, has described as inaccurate suggestions that a company cited in the controversial crude oil transaction with the Bulk Oil Storage and Transportation (BOST) did not need a permit to trade in Ghana.
The sale of 1.8 million barrels of crude oil to BB Energy by BOST in September has been in the news over allegations that the state lost about $30 million after the deal.
The Chamber of Petroleum Consumers (COPEC), a petroleum industry watcher, says it has credible information that BOST sold the crude oil to BB Energy at an unreasonable discount.
COPEC further claims that BB Energy is an unlicensed company and hence could not have dealt with BOST.
BOST has responded to the allegations and insists among others that per the laws of Ghana, BB Energy did not need a license from the industry regulator, the National Petroleum Authority (NPA), to transact business in Ghana.
However, speaking on Upfront, a current affairs TV programme on the Joy News channel (MultiTV) on Wednesday, Mr Bawa said BOST’s defence of the alleged shady deal was fraught with inaccuracies.
“The [NPA Act] indicates clearly that to handle hydrocarbon materials, you will need a permission. BB Energy is buying the product from BOST and that’s trading. The Act indicates clearly that before you engage in such an exercise, you will need to have a permit,” he told show host Raymond Acquah.
Mr Bawa could not show which provision of the NPA Act expressly bars transactions between BOST and unlicensed company but stated: “BOST itself is regulated. Its actions are regulated by NPA. BOST by its own procedures is supposed to deal with licenced companies.”
The latest BOST scandal comes months after a similar scandal involving the sale of some five million litres of contaminated fuel to 38 unlicensed companies.
Tracing the origin of the 1.8 million barrels of crude, Mr Bawa revealed in a statement he had issued before the programme that a company called AOT had sold the barrels of oil to BOST in November 2016.
“The nature of the transaction was that the supply was done on an open account basis. This means that BOST did not need to establish a letter of credit (LC). BOST usually won’t pay for such a transaction until after 120 days. The current management of BOST has now gone ahead to sell the crude at a discounted price to an unlicensed company called BB Energy.”