Oil Industry in Ghana: CEO Yahya Diab Discusses Veros Petroleum’s Vision, Challenges and Growth

Interview with Yahya Diab, CEO at Veros Petroleum

Could you please start by providing a brief overview of the company’s background?

Veros Petroleum is an oil marketing company that covers various aspects of the oil marketing industry, including retailing, bunkering, bulk distribution, LPG and gas services, and other related sectors. We cater to retail markets with stations dispersed nationwide, primarily in strategic regions, and continue to expand. As one of the rapidly developing companies, we take pride in our competitive pricing, exceptional services, top-notch product quality, and more. Moreover, we also provide bulk supplies to mining and construction sites. Our company was officially registered in 2020, but our journey began back in 2016 when we started as a small supply chain business, dealing with lower volumes and quantities. Over time, we have evolved into the company we are today.

What sets Veros Petroleum apart from other oil and gas businesses?

In the realm of oil marketing, three key factors matter most to our clients. Firstly, the quality of our products is a top priority. Secondly, the speed and availability of our product delivery are crucial. And thirdly, pricing is significant. Regarding pricing, we focus more on trading higher volumes than maximizing profits, as we believe this approach fuels rapid expansion. Our prices are very competitive in the market and offer affordability compared to other oil companies; we pride ourselves on being one of the most cost-effective options available. When it comes to product quality, we maintain stringent standards and certifications, ensuring that the fuel you receive at our stations is on par with the offerings of other prominent brands.

What is your evaluation of the present condition of the oil and gas industry? Could you share insights into any prominent trends or significant developments in this field?

The oil and gas industry is a highly diversified field, and it is incredibly vast. It is marked by constant changes and a dynamic nature. It is challenging to pinpoint specific trends, but let us focus on some significant aspects. Price fluctuations are a regular occurrence, influenced by various factors. The distribution channels are continuously evolving, and they can vary significantly from one location to another. Demand and supply dynamics are also subject to change, with certain seasons leading to fluctuations in sales volume. For instance, during the rainy season, operations tend to slow down.

At present, the notable trend in the market is the consistently high fuel prices, which has raised concerns among customers. It has become quite expensive to travel from one place to another, and people are adjusting their habits accordingly. Rather than making frequent stops at fuel stations, they are now more likely to limit their journeys to essential routes. For example, traveling from home to work and back without unnecessary detours. Fuel prices have increased substantially compared to five years ago, even during the COVID pandemic. It used to cost around 500 Cedi to fill up your car, but now it is approximately 1200 Cedi, more than double the previous cost.

These factors certainly affect the industry, but when you compare Ghana‘s fuel prices to those in other countries, we are relatively competitive. We are striving to keep prices in check, not just for competition’s sake, but also to support consumers. The challenge lies in managing our inventory since stagnant fuel in our tanks can pose risks when prices suddenly surge or drop. Despite these challenges, the oil sector in Ghana is encouraging, with room for improvement, and there are no significant drawbacks to highlight.

You mentioned the focus on trading volumes. Does this mean you solely concentrate on trading volumes and not retailing at all?

No, we engage in both retailing and bulk supply. In the retailing sector, we have stations situated across various locations in Accra, including Apollonia and Dodowa. We have a presence in several regions, such as Ashanti. However, when I refer to bulk supplies, it involves catering to companies or industries that may not have the opportunity or time to visit our retail stations. For these clients, we construct on-site tanks, they receive fuel in bulk, essentially having their storage facility right on their premises. Whenever they require fuel, we provide the supply directly to them for their consumption.

Could you provide information about the geographical areas in which your gas stations can be found?

We have a presence in the Western region, Greater Accra, Ahafo region, and the Ashanti region. We are quite spread out, but a significant number of our gas stations are concentrated within the Accra region. I believe we have approximately seven or eight stations in the Accra region. Our stations are easily recognizable due to our distinctive logo, brand and vibrant colors. When people see our branding, they can readily identify our stations, making us stand out in the industry.

Could you kindly mention some of the clients you engage with for bulk supplies?

In the Western region, we have had engagements with prominent industry firms, such as Mondial Veneer. We have also provided supplies to quarries and manufacturing industries. These clients source fuel from us, although some are not on a consistent basis due to their substantial demand, which often requires collaboration with two or three companies to fulfill. Additionally, in Accra, we collaborate with Betonsa, a leading premix concrete factory in Ghana.

Could you provide some insights into any ongoing or upcoming projects?

Currently, our primary focus is on expanding our retail presence. We are in the process of establishing new stations in the northern region. These stations are in the pipeline to become officially part of our network. At the moment, our emphasis is on developing retail outlets. There is a notable demand and numerous requests from various communities. We receive requests through our social media platforms from people who wish to see our brand in specific locations, regions, and areas. To meet these demands, we are committed to gradually establishing stations in each community, one community at a time, to ensure that we have a station that serves each locality.

How do you maintain your competitive edge while expanding your station network?

It boils down to our passion for the brand and effective teamwork. You cannot expect things to run smoothly without the right people in place. Targeting the correct audience is crucial, and I believe we have been successful in doing so. While pricing is a factor, it is not the sole determinant. The core of our success lies in the passion we have for our brand. When customers visit our stations and experience value for their money, including the right product, quality, and quantity, the word spreads, and people take notice.

One noteworthy observation in Ghana is that drivers are always on the lookout for the best fuel prices. When they find affordable prices, they readily pull into a station. This dynamic has been beneficial for us. Additionally, our stations are strategically located in well-placed communities, giving us exposure. In terms of pricing, I can confidently say that we offer competitive prices. While I will not claim to be the absolute cheapest in the market, we are among the best in terms of pricing, offering a balance of affordability and quality.

Are you the sole founder and owner of the company, or do you have other partners involved?

I am both the founder and the CEO of the company. I initiated this company’s journey. It began as a small-scale supply chain business, dealing with modest volumes. We were actually among the very first companies in Ghana, if not the first, to have fuel distribution trucks, or bowsers. During the COVID era, we played a crucial role by supplying hospitals, government institutions, and factories for approximately two to three years. As demand continued to surge, especially for larger volumes, we made the strategic decision to elevate our operations and expand into what is now Veros Petroleum.

Are you considering seeking additional investment or potentially partnering with others to further expand your business?

We are certainly open to opportunities, just as anyone would be, as long as they are mutually beneficial. That is the key consideration. In the current market scenario, with the trends in fuel prices, we have been approached by individuals and groups interested in investing in our company. They have ideas and propositions to bring to the table. We are open to hearing these ideas, provided they align with our criteria and have the potential to benefit the company while ensuring mutual gains. So, yes, we are open to such possibilities.

Looking ahead to the next few years, what are your medium-term growth aspirations for the company?

I believe that as humans, we all hope to witness our companies or projects prosper and exceed expectations. By 2025, our target is to have a network of at least 25 stations across the country, and we are actively working toward that goal. Additionally, we aim to enhance our market share in both retail outlets and bulk consumption. Alongside these efforts, we have plans to expand our licensing to operate as a bulk distribution company. This step will enable us to procure our own products, as many oil companies in Ghana currently source from specific terminals and bulk distribution companies. Our plan is to expand our operations and deliver quality products at competitive prices, ensuring that consumers do not feel overly burdened when refueling at our stations.

In addition to fuel, do you have ownership and sales of other petroleum products, or is fuel the primary focus of your product offerings?

While we do have collaborations with lubricant supply companies that provide their lubricants, which we sell at our retail outlets, it is a different aspect of our operations. In Ghana, it is becoming increasingly common for vehicle owners to get their vehicles serviced at mechanics’ shops or the showrooms where they purchased their cars, rather than at fuel stations. We do have some service bays at a few of our stations, but this aspect of our business is not as prominent. Our primary focus remains on retailing fuel and bulk supply of fuel, including petrol, diesel, and kerosene. These are the core components of our operations.

Are you presently involved in any initiatives related to corporate social responsibility?

Yes, we have undertaken a few CSR initiatives, although they may not be widely publicized. We have collaborated with certain institutions and made donations during the COVID pandemic. Additionally, we have contributed to infrastructure development for specific institutions. I tend not to extensively discuss these matters in public, but yes, we have been involved in several CSR efforts.

Is there any particular topic or aspect that we haven’t addressed which you would like to bring up for discussion?

I would encourage people to consider investing in Ghana. While some may perceive economic challenges, I believe there is room for improvement, and the situation is steadily improving. This is not unique to Ghana; many countries worldwide face economic challenges. Ghana remains an attractive place to invest with wonderful people and opportunities for collaboration, not only in the oil industry but across various sectors. If you have any oil and gas-related needs, I would recommend reaching out to Veros Petroleum.

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