GOIL moves for more profitability

…diversifies into bitumen trade with Cote d’Ivoire’s SMB

Indigenous oil marketing company, Ghana Oil Company (GOIL), has entered into partnership with Ivorian bitumen maker, SMB, as part of plans to diversify fortunes of the company for extra profitability.

As part of the arrangement, GOIL will control 60 percent shares in the business as the sole sponsor, with SMB (Societe Multinationale des Bitumes) contributing its technical know-how to the venture and controlling the rest of shares.

A sod cut ceremony for the installation of modern bitumen storage and blending facility for the project has officially been scheduled for June this year in Takoradi, and will be completed in 12 months.

In full operation, the facility is expected to employ more than 500 persons.

GOIL’s MD and Group CEO, Mr. Patrick Akorli, explaining to the Goldstreet Business at the 49th Annual General Meeting of the company in Accra, said the move will also involve the sale and supply of lubricants, Marine Gasoil (MGO) and Marine Diesel Oil (MDO).

“OMCs are getting distressed and so the idea is to diversify and supply to fishing vessels including oil supply vessels doing business in the upstream sector. GOIL has identified great prospects in that area and we want to take advantage of it,” he said.

Akorli mentioned major competition in the downstream sector, as the key reason for the diversification as well as the need for GOIL to garner enough revenue to compete at the sub-regional level.

The company’s stakeholders have recently expressed concerns on when GOIL will be entering the West African sub region to compete.

However, Akorli said that could only happen when the purchasing power of the Ghanaian increases.

“Entering the sub region can’t be possible without increasing the purchasing power of the Ghanaian customer. When the purchasing power increases, the company can go international thereby increasing the shareholder’s wealth. We may not be lucrative going international without a strong customer and financial base,” he said.

Analysis of the downstream market at the AGM indicates that GOIL remained the biggest company in the country in terms of market share, achieving a share of almost 20 percent in 2017, up from 18.2 percent in 2016.

The analysis also revealed that, the company’s financial results were impressive with a net profit of GHS65.1 million, up by 21 percent.

The Group also increased its earnings per share from GHS0.137 in 2016 to 0.166 as at the close of 2017.
Meanwhile, GOIL’s Board Chairman, Mr Kwamena Bartels, has attributed the company’s growth to the competency of management and staff, which had been a significant factor to the company’s success.

By Wisdom Jonny-Nuekpe