By: Staff Writer
Colombo (LNW): The Ceylon Petroleum Corporation (CPC) has recorded a profit of Rs. 43.4 billion for the first four months of 2023, according to the Mid-Year Fiscal Position Report issued by the Minister of Finance.
The average import price of crude oil in the global market dropped further, from USD 81 per barrel in December 2022 to USD 78.5 per barrel in March 2023.
However, the total petroleum bill, which is close to USD 1,599.7 million, represented about 30 percent of total imports into the country during the first four months of 2023 with a 16.8 percent drop compared to year on year.
The imports of petroleum and petroleum products by the CPC for the first four months of 2023 amounted to USD 877.35 million, representing nearly 54 percent of the total petroleum bill.
A decrease in the import cost in line with the decline in international oil prices has resulted in improvements CPC working capital rotations during the period starting in January 2023; it has also led the CPC to record a profit of Rs. 43.4 billion for the first four months of 2023.
Further, due to the weak financial position and liquidity constraints of the CEB and SLA, the total outstanding liability, including CEB and SLA, to the CPC increased to Rs. 238.9 billion.
On the other hand, the CPC has residual liabilities to the Government for its on-lending of the Indian Line of Credit facility (USD 697 million), liabilities to the National Iran Oil Company (USD 251 million), and the Bank of Ceylon (Rs. 26.2 billion) at the end of April 2023.
Therefore, CPC was unable to settle the Indian Credit Line worth USD 697 million, which was used to facilitate fuel importation.
Hence, the treatment of these cross liabilities between the Central Government, CEB, SLA, and CPC would be addressed in the Government’s overall strategy for restructuring the balance sheets of key SOEs.
The Government has signed agreements with two established companies in petroleum producing countries for the importation, storage, distribution, and sale of petroleum products through the predetermined distribution dealers operated in Sri Lanka.
This will introduce competition in petroleum retail in Sri Lanka and improve service standards for the benefit of the consumers.
