Accra, July 19, GNA - Professor George Gyan-Baffour, Deputy Minister of Finance and Economic Planning, on Wednesday said since 2002 to May 31, 2006 a total amount of 6,390,596,906,610 cedis have been spent on the Tema Oil Refinery (TOR).

He said the amount covered payment of principal and interest on TOR's debt and "payments effected for the Company's under-recovery." The Deputy Minister was responding to a question in Parliament on how much money had accumulated to the credit of TOR debt recovery account, how much of the debt had been paid and how much of the debt was left.

Prof Gyan-Baffour said a debt recovery levy was established in 2003 by the Debt Recovery (Tema Oil Refinery Company) Fund Act, 2003 (ACT 642) to finance payments of debts incurred by TOR and interest accruing on those debts.

"Since its introduction a total amount paid as at May 31, 2006 is 3,582,407,051,142. cedis."

He said TOR's debt arose out of the Company's inability to service debts owed to banks involved in the establishment of letters of credit for the importation of crude oil for the refinery.

"In order to clear the refinery of this indebtedness and clean the balance sheets of the Ghana Commercial Bank, (GCB) the Government in 2004 issued the Ghana Petroleum Financed Bond totalling 800.2 billion cedis to the Bank of Ghana. Which brings the total bond issued to 3.2 trillion," Prof. Gyan-Baffour said.

He said various situations, including changes in world oil prices, deregulation and under-prediction in world oil prices and other things, led to the continuous under recovery by TOR so additional debt was incurred to the tune of 1.1 trillion cedis in 2006.

"To clear the refinery of this indebtedness and clean the balance sheets of GCB, the Government in June 2006, issued TOR bonds to the tune of 1,100 billion cedis to the GCB. Bringing the total bond issued to 4.3 trillion."

"So far, all the instruments issued as TOR bonds sum up to 4,300,629,064,000 cedis. Out of this amount, a total of 1,345,523,558,000 cedis have matured and have so far been paid. Therefore, the outstanding stock of TOR debt is 2,955,105,506,000 cedis," he said.