Tullow Oil has begun selling crude oil from its Jubilee and Tweneboa, Enyenra and Ntomme (TEN) fields to refineries in Ghana, in a development expected to support domestic refining and strengthen linkages within the country’s oil industry.

The company confirmed that the first cargo was sold earlier this year to Sentuo Oil Refinery, marking a significant step towards supplying locally produced crude to Ghanaian processing facilities.

Tullow Oil Chief Financial Officer Richard Miller disclosed the development during a virtual meeting with investors on the company’s half-year results.

He was responding to a question about efforts to encourage more crude oil produced from the Jubilee field to be refined locally.

Mr Miller described the development as a significant achievement for Ghana’s oil sector, highlighting the progress made in connecting domestic crude production with local refining capacity.

Sentuo Receives First Cargo

The initial sale to Sentuo Oil Refinery represents a move towards increasing the use of Ghanaian-produced crude within the domestic market.

Tullow’s decision to supply local refineries could create opportunities for greater cooperation between upstream oil producers and downstream processing companies.

The development also comes amid efforts to strengthen Ghana’s refining industry and reduce reliance on imported refined petroleum products.

However, the long-term impact will depend on the volume of crude supplied locally, the capacity of domestic refineries to process it and the commercial terms governing future transactions.

Boost for Ghana’s Oil Industry

Ghana produces crude oil from offshore fields, including Jubilee and TEN, while also importing significant volumes of refined petroleum products to meet domestic demand.

Selling locally produced crude to Ghanaian refineries could help strengthen connections between the upstream and downstream segments of the petroleum industry.

For domestic refineries, access to locally produced crude may provide an additional sourcing option, depending on the quality of the crude, processing requirements and prevailing market prices.

For the wider economy, increased domestic refining could create opportunities for local value addition, industrial activity and employment across related sectors.

The extent of these benefits, however, will depend on the sustainability of crude supply arrangements and the operational and commercial performance of local refineries.

Focus on Expanding Local Crude Supply

Mr Miller’s comments suggest that discussions around domestic refining are beginning to translate into actual commercial transactions, with the first cargo to Sentuo providing an initial example.

The development could also encourage further engagement between oil producers and Ghanaian refineries seeking access to locally produced feedstock.

The volume and frequency of future deliveries will be important in determining whether the arrangement develops into a sustained supply channel rather than occasional transactions.

Tullow’s latest disclosure therefore represents an important development in efforts to increase domestic participation in Ghana’s petroleum value chain.

As the country continues to explore ways of strengthening its refining industry, the delivery of locally produced crude to Sentuo Oil Refinery could mark a step towards retaining more value from Ghana’s oil resources within the domestic economy.