CPC monopoly to end with govt. inviting multinational companies
Posted on June 21st, 2022

By Rathindra Kuruwita Courtesy The Island

Minister of Power and Energy, Kanchana Wijesekera, on Sunday, told the media that giving the Ceylon Petroleum Corporation (CPC) the monopoly over the oil industry was a mistake and the government was taking steps to allow multinational oil companies to recommence operations in Sri Lanka. The petroleum sector was nationalised in the early 1960s and the CPC was given a monopoly.

Addressing the media in Colombo, the Minister said that several other companies must get involved in fuel distribution in the country as it had become obvious that the CPC couldn’t do it alone.

We need a few companies like Lanka IOC. Soon, I will present a Cabinet Paper on this matter. Not only the CPC and the LIOC, but also companies of other oil producing nations must be given the chance to supply and distribute oil. Companies like Shell and Caltex were in Sri Lanka earlier. We made a serious error when we gave the CPC a monopoly,” he said.

The Minister also insisted that many oil companies had shifted to Singapore after Sri Lanka nationalised the petroleum sector. The Minister said that Singapore had become a petrochemical hub thereafter.

” We want a company which can give us oil at least for one year on credit––a company that could use its own funds to import fuel. The purpose will be lost if they too start tapping into the dollars that local banks have. If the IOC wants to expand, we must allow that to happen. We have taken a decision to allow oil producing companies to start operations in Sri Lanka,” he said.

The Minister also said that two ships carrying petrol and diesel would arrive on the 23 and 24 June. Sri Lanka had enough stocks of diesel for 10 days and the CPC was supplying to the market more than it usually does, he said.

The LIOC has 10,000 MT of petrol in its stores in Trincomalee. It only issue 300 MT a day but we asked it to release 1,000 tonnes a day in the coming days. We urge people not to queue up for petrol in the coming four days unless it’s an emergency,” he said,

The Minister also insisted that the CPC officials were following procurement guidelines to the letter when making fuel purchases, as they feared that they would be hauled up before various probe commissions and therefore they were hesitant to take prompt action. The Cabinet is now contemplating laws to give officials some legal cover to protect themselves, when officials take proactive decisions during emergencies.”

The minister said: The Ceylon Electricity Board (CEB) needs fuel to ensure that power cuts do not exceed three hours. The train services also need 150 tonnes of diesel a day. State and privately owned buses, engaged in public transport, need 600 tonnes of diesel a day.  We have instructed depots to pump diesel to buses with route permits from Sunday (19). The police have been instructed to provide security. Tourist coaches, staff transport services and school services, too, can queue up at sheds. There is fuel for everyone.  I urge drivers of these vehicles not to queue up in gas stations from now on.”

The Minister also said that in the next week the police and divisional secretaries would come up with a list of full-time three wheeler drivers and allocate them specific gas stations for refuelling.

We will divide the vehicles so that each vehicle has two days a week to obtain 20 to 30 litres of fuel. Health workers can also get fuel to their vehicles at selected gas stations every Friday.  We will get three crude oil shipments on 29 June and 10 and 14 July,” the minister said.

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