Ghanaian seeks mergers in local oil marketing firms to compete with multinationals
The growing balkanization and proliferation of petroleum marketing companies in African oil producing countries is part of the reasons why deep pockets International Oil Companies (IOCs) are leading in downstream activities.
This was the submission of Accra energy consultant and Managing Director of Mocoh Ghana Limited, Mr Kwame Kessie, in an interview with Business Hilights Ghana Bureau chief.
Recall that Mocoh Ghana Limited which is a supply and trading company with a focus on Africa recently acquired 100 per cent shares of Engen Ghana Limited to bring to the local market services of world class logistical team who understands the complexities of the markets.
Engen Ghana under its new management through Mocoh would inject in the Ghanaian downstream sector industry dynamism to help customers find the right solutions to ever changing market conditions.
Kessie revealed that just like in other major oil economies including Nigeria, Ghanaian downstream oil marketing sector is choked as about 90 officially registered companies with the Association of Oil Marketing Companies (AOMCs) with scores of them not doing well or existing in real sense.
The consultant averred that with mergers and acquisitions, indigenous oil marketing firms will become few, stronger and have appetite for further investment that may either compete favourably with IOCs or even out crowd them, saying “it is dangerous for any nation to allow multi-nationals to dominate the sector”.
Mocoh Ghana Limited boss argued further that considering the fact that the energy sector was capital intensive, with diverse security implications, the current surge for setting up OMCs with its attendant citing up of Filling Stations, it will be difficult for “our smaller OMCs to make meaningful impact. Some even operate only one Filling Station whilst others have only registered with the regulator, but without any presence on the grounds”.
Kessie noted that with effective mergers and amalgamations, “Monies generated from the sector will remain in the country; our local currency will be strengthened as funds will not be repatriated to any third country.”
