By Alfred K Dogbey
The National Petroleum Authority (NPA), has finally blocked the disturbing criminal activities of fuel adulteration business by unscrupulous elements in the petroleum industry, which deny the country millions of tax revenues.
The activity which is mostly suffered by poor consumers of petroleum products was brought to an end through an introduction of a new programme, the Petroleum Products Marking Scheme (PPMS) by the NPA.
The initiative, which was launched in Accra on Monday, by the Minister of Energy and Petroleum, Mr Emmanuel Armah Kofi Buah, will also fight the years-long cross-border petroleum products smuggling business.
Mr. Kofi Buah, who delivered a speech on behalf of President John Mahama said “a section of the petroleum industry that indulges in adulteration cheats the consumer out of what they are paying for, harms the reputation of a fuel retailer’s brand and cost government millions of cedis in revenue each year”.
He noted that the fuel adulteration was a global problem that posed a major challenge to both industry and regulators.
The minister mentioned that Countries such as Brazil, South Africa, Uganda, Tanzania, among others have adopted Petroleum Product Marking programme to monitor fuel quality, as well as to recover fiscal tax revenue from the sale of petroleum products.
The adulteration, Mr. Kofi Buah explained, was not limited to diesel and kerosene alone, saying gasoline adulteration with premix fuel was a common practice as a result of the significant price differentials between the two products.
He lamented that “as social democrats, we are concerned when subsidized products also called “social products” do not reach the desired target.
Premix for the fisher folks and kerosene for the farmer in rural community the minister stated are meant to enhance their economic activity and improve livelihood of the people”
However, he said, “Very often, these social products do not reach their desire target in the quantity required thus leave the affected targets frustrated.
“We are happy to learn that the PPMS will discourage this practice of diversion which is detrimental to our effort at building a just and fair society,” Mr Buah maintained.
On the part of the Chief Executive Officer (CEO) of the NPA, Mr Moses Asaga, he, said the introduction of the PPMS was a demonstration of the government’s commitment to improve standards in the petroleum downstream industry.
He said as Regulator of the downstream petroleum industry, NPA holds a dual objective of ensuring that the industry continues to be efficient and profitable whilst satisfying consumer demands for quality fuel and value for money.
Mr. Asaga noted that “the PPMS concept is a novelty aimed at halting adulteration of fuel and ensure that subsidized petroleum products reach the target group.
He assured the this initiative will recoup revenue which would have been lost through diversion of subsided petroleum products, adding that the implementation of the PPMS would further ensure that consumers of petroleum products in the country get clean and unadulterated fuels.
The PPMS, he said, had been on trial since February 2013, adding that the trial phase had been successful and the scheme was now due for full implementation.
“The launch will commence the full implementation of the programme, in full accordance with Legislative Instrument (LI) 2187. This means that, where applicable, sanctions will apply to defaulting petroleum service providers,” he announced.
The LI 2187, he said, provided punitive sanctions such as fines, imprisonment or both, saying that was to send a signal to the industry that the age-old practice of adulteration and diversion of subsidised petroleum products would no longer be tolerated.
The NPA boss disclosed that a survey by the NPA revealed out of the 2,700 retail outlets operating in the country, “we sampled 1000 stations and recorded violation of more than 32%.
This violation, Mr. Asaga said translates into revenue loss in excess of GH¢50 million through diversion of subsidized petroleum products.
He assured that the PPMS will succeed and deliver on its core objectives of improving fuel quality and blocking revenue leakage.