A proposed bill by the National Petroleum Authority (NPA), yet to be laid before Parliament, is expected to introduce significant reforms to petroleum pricing and funding structures in Ghana’s downstream sector.
The Chief Executive Officer of the Authority, Edudzi Tamakloe, disclosed the key proposals during ongoing stakeholder consultations on the draft legislation. He explained that the bill aims to streamline existing petroleum levies and enhance efficiency, transparency, and cost recovery mechanisms within the industry.
A central feature of the proposed reforms is the consolidation of existing funding mechanisms. According to Tamakloe, the Unified Petroleum Pricing Fund (UPPF) and the Primary Distribution Margin (PDM), which currently operate as separate components to absorb fuel distribution and logistics costs, will be merged into a single entity known as the Distribution Fund. This, he noted, is intended to improve coordination and management of petroleum pricing structures.
The bill also proposes the establishment of an Infrastructure Fund to support strategic investments in the sector. Tamakloe indicated that revenues such as the Bulk Oil Storage and Transportation Company (BOST) margin would be channelled into this fund to strengthen infrastructure development.
Additionally, the draft legislation incorporates provisions linked to the Cylinder Recirculation Model (CRM), including a levy of approximately $80 per metric tonne of liquefied petroleum gas (LPG). This charge, introduced under earlier legislation, is designed to finance investments in cylinder circulation systems, which aim to enhance safety and efficiency by transitioning from individual cylinder ownership to a centralised exchange model.
Tamakloe explained that the policy seeks to mitigate the financial burden on consumers by enabling the state to absorb part of the infrastructure costs incurred by private bottling companies. This approach, he suggested, would facilitate broader implementation of the cylinder recirculation system without transferring the full cost to end users.
He added that stakeholder consultations remain ongoing ahead of the bill’s formal submission to Parliament, as efforts continue to modernise regulatory and funding frameworks within Ghana’s petroleum sector.
