The Bulk Oil Storage and Transportation Company Limited (BOST) has responded to the Institute of Energy Security (IES) over the latter’s recent call for the withdrawal of increased margins on petroleum products.
BOST says the IES’ explanation of the increase in the BOST Margin was a “sensationalized interpretation”.
Last week, IES asked government to without delay, withdraw the increased levies on some margins in the Price Build-UP (PUB) of petroleum products.
The said amended margins included the BOST Margin, the Primary Distribution Margin (PDM), Fuel Marking Margin (FMM) and the Unified Petroleum Price Fund (UPPF) Margin.
But BOST in a statement said the “civil society organization is simply asking for a withdrawal of the purported upward adjustments in the margins.”
According to the IES, the UPPF Margin of 3 pesewas per litre has been added to all liquid products except for Premix fuel, MGO Foreign, Gasoil Mines, Gasoil Rig, plus the addition of 3 pesewas per kilograms on LPG.
The PDM has also been increased to 3 pesewas per litre of Petrol, Diesel, and Kerosene.
Similarly, the Fuel Marking Scheme has seen an increment of up to 167% from 3 pesewas per litre to 8 pesewas per litre for all liquid products.
It also said the BOST Margin has recorded an increment of 100% from 6 pesewas to 12 pesewas per litre.
However, BOST clarified the issues raised as follows:
- On the BOST Margin, it was introduced purposely for the operation and maintenance of the petroleum storage and distribution infrastructure. Given the huge investments made in building these over the years, failure on the parts of successive governments to review the margin from 2011 resulted in massive dilapidation and in some instances, decommissioning of some of these strategic assets. The upward adjustment received was a decision in time to stem the tide of dilapidation and bring these assets back to life and into use. The twisted interpretation is therefore unfortunate and should be disregarded with the full force of every meaningful appreciation of the need to keep stocks of petroleum products for the nation.
- The Primary Distribution Margin, PDM, the tax in the petroleum price build-up which is utilized in the distribution of petroleum products across depots in the country is targeted at ensuring uniformity in petroleum product prices across the nation. It was under the management of BOST until 2012 when the responsibility was transferred to the National Petroleum Authority, NPA. The categorical statement that BOST is still managing this margin is simply false and should be disregarded.
- On the GHS3 pesewas upward adjustment in the BOST margin, our initial request was GH9 pesewas to restore the value to the 2011 dollar value. Despite our unsuccessful attempt, the GHS3 pesewas, has been efficiently utilized by the company.
“We at this point call on the public to have confidence in the current management and look forward to nothing but the best from the company”, BOST concluded in its statement.