The Bulk Oil Storage & Transportation Company (BOST) has set its sight on raising additional funds from the capital market to turn around its fortunes.
BOST, which is mandated to hold strategic stocks of petroleum products for the country and ensure an efficient distribution regime through its network of storage and distribution infrastructure, has been saddled with huge debts over the past half-decade.
The company, as at 2017, owed product suppliers and related parties US$624 million. This has, however, been reduced to US$ 50million under the current management.
The oil storage company, on the back of its improved debt position, is now looking to be self-sustaining and turn to the capital market, on its own balance sheet, in the years ahead.
“So our first priority is that government should help our legacy debt, clean our balance sheet so we can go to the market and borrow on our own terms and use it to turn around the company.
“But if the government is magnanimous enough and can get us the money, we will definitely pay back. We don’t want free money, we will pay back the money to government,” Mr. Edwin Provencal, Managing Director of BOST, told Parliament’s Committee of Government Assurances during a visit by the Committee to the company’s site at Tema.
“We are grateful the Committee came, we do not need money from the government, what we need from the government is to take measures to clean our balance sheet, one of them is to help us pay our legacy debts.
“The other is to give us comfort letters or guarantees for financial institutions or investors who want to come in to support us, if government decides to find money for us we will be very grateful,” the Managing Director of the state-owned company added.
Chairman of the Government Assurance Committee, Collins Owusu Amankwah, indicated the company has done well to reduce the huge debt it inherited and backed management’s call for capital injection.
“We realize that in terms of total installed fuel capacity, they have managed to bring it up to the standard of 2017. So, for us members of the Committee when we toured the facility and had the briefing session, what we can say is that the current management led by Mr. Provencal has done a good job which requires government support,” he said.
Ranking member of the Committee, Dr. Rashid Pelpuo, also called for the recreation of the company to benefit all Ghanaians. “I think, essentially, we need to recreate BOST, we need to start making money out of BOST. Over the years the losses we have experienced are unacceptable.
I am happy to hear that management has decided to stop the losses and they are going to begin to produce and get profits. That is good news and to do that they don’t want money from anybody, they want to have credibility so they can borrow on their own balance sheet.”