Fight against illicit trade of petroleum products yields dividends

An estimated GH¢249million in tax revenue was recovered at the end of 2018 as a result of implementing the Petroleum Product Marking Scheme (PPMS) and field monitoring activities by the National Petroleum Authority (NPA).

The amount was salvaged between 2013 when implementation of the PPMS began and 2018. Its implementation has so far also led to a drop in smuggling, adulteration of petroleum products, or cheating to1.9 percent from 32 percent between 2013 and end of 2019.

This was revealed by the Chief of Staff, Akosua Frema Osei-Opare, who launched Phase II of the PPMS at an event themed ‘Quality fuels, value for money’, in Accra. PPMS, she explains, is designed to check product adulteration and also address some revenue leakages associated with the sale and smuggling of petroleum products in the country.

“The fear of fuel adulteration is that consumers who pay for quality products not only end up being cheated but lose money in the process. Also, the reputation of the fuel retail outlet where such purchases are made is also tarnished. Last but not least, government also loses millions of cedis in revenue that is needed to develop the country,” she said.

A 2013 initial assessment by NPA sampled over 1,000 fuel retail outlets – of which 32 percent were tested countrywide – and indicated that violations translated to an estimated revenue loss in excess of GH¢50million in the form of lost tax revenue and diverted subsidies on products including pre-mix fuel and kerosene, among others.

How it works

The concept of Petroleum Product Marking involves the introduction of a bio-chemical liquid (fuel marker) into the petroleum products at the loading depots prior to delivery of said products to the retail outlets. The marker creates a ‘fingerprint’ and provides a secure, tamper-proof method of authentication.

Low levels of the marker are usually applied to the petroleum product, and the marker’s concentration can only be detected by patent-protected portable field devices. These patented devices are used by field monitoring officers to detect violations.

The marker is a unique identifier that aids in distinguishing the various types of petroleum products and exposes the addition of any foreign product. This is achieved by testing samples of petroleum products on a monthly basis at approximately 75 percent of retail outlets & bulk consumers across the country.

The Phase II is anchored on technological advancements in the markers as well as the proprietary detection equipment. The marker has been uniquely designed for the Ghanaian market, with a chemical composition to aid in immediate equipment quantification and detection to enable the NPA make swift decisions on whether retail outlets have dumped or adulterated the petroleum products being offered for sale at retail outlets.

Nationwide Technologies Limited (NTL) is the company contracted to undertake the fuel-marking activities.

NPA CEO

According to the CEO of NPA, Alhassan Tampuli, contaminated fuels not only have a negative impact on the environment but also cause costly damage to combustion systems.

“Many mechanical breakdowns, such as engine failure and fuel starvation, can be attributed to poor quality of petroleum products. In this regard, an effective fuel quality management system in place will ensure that the quality of petroleum products is constantly monitored by fuel quality tests and analysis to mitigate all potential effects of poor quality fuels, and thus assure customers of improved quality of fuel and value for money,” he stated.

In this vein, he said, the PPMS will ensure consumer satisfaction with regard to quality of petroleum products supplied to the market.

“The PPMS Unit provides a foundation for an effective quality monitoring system by introducing a marker in trace quantities into petroleum products at all operational depots in the country prior to distribution on the market,” he said.