NPA launches electronic cargo tracking system to clamp down on illicit fuel diversion

NPA launches electronic cargo tracking system to clamp down on illicit fuel diversion
Source: Charles Ayitey | JoyBusiness
Date: 14-01-2020 Time: 06:01:08:pm

The National Petroleum Authority (NPA) has introduced an electronic cargo tracking system and the national command centre to deal with the upsurge of disruptions in the delivery of petroleum products. 

Checks with the NPA show Ghana loses about GH¢200 million to illegal operations regarding the transportation of fuel.

After concerns over the failure of the National Petroleum Commission (NPC) to deal with the diversion of petroleum by some drivers of Bulk Road Vehicles to unapproved routes, the launch of the electronic cargo tracking system and the national command Centre are to track all BRVs.

“Some transport service providers exploited the lack of capacity of the NPA to independently confirm the delivery of petroleum products to retail outlets. Indeed it was a common thing for service providers to deliver freight claims for delivery of petroleum products to distant locations when indeed it was delivered here in Accra. This cargo tracking system ends such a trend,” CEO of the National Petroleum Authority (NPA), Hassan Tampuli stated.

Deputy energy minister, Dr Mohammed Amin Adam decried the increase in illegal pricing in the downstream sector. He's called for some diversification when it comes to the transportation of fuel. He warned that “the culture of a price war among OMCs and the smuggling of fuel” must end under this regime of digitization.

Meanwhile, Vice President Dr Mahamadu Bawumia has hinted of further digitizing premix fuel to check wastage and illegal smuggling. The National Command Centre is expected to take care of all retail outlets across the country.

The fight against the illicit trade of refined petroleum products is yielding results, with the latest report on the activities in the downstream petroleum subsector showing that the country saved nearly GH¢1 billion, which would have otherwise been lost through smuggling of the products. 

The report showed that GH¢952 million was saved from blocking the sale of illicit sale of petroleum products in the country in 2018. This was a reversal from the losses made in the last three years – 2015 to 2017- through unaccounted stock and evasion of taxes.

The savings was as a result of interventions by the National Petroleum Authority (NPA) to curb the illicit trade of petroleum products and ensure that it was sold through official channels, the annual report of the Chamber of Bulk Oil Distributors (CBOD) said, “In 2018, no loss related to unaccounted stocks is estimated as it was revealed that 574.25 million litres more than the official stocks saleable in the country were sold. This indicates that smuggled stocks in the monitored depots must have been trapped as a result of the NPA’s regulatory interventions to curb the illicit trade of petroleum products and forced to be sold through official channels.

“This saved the nation GH¢797.49 million in taxes and GH¢154.93 million in regulatory margins yielding a total savings of GH¢952.42 million,” the report stated. According to the report, the NPA, aided by elements of the central government made progress towards tackling the challenges of smuggling and tax evasion some of which were covered in the 2017 CBOD industry report. “This was a welcome move in the industry and yielded tangible results even though there remains a lot to be done to bring sustainable finality to the illegal trade,” the report stated.