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A 50-year Agreement signed with IOC for Trincomalee Oil Tank Project

An agreement was signed yesterday (06) with a new company to be set up to develop the Trincomalee oil tank complex as a joint venture with India.

S.R. Attygalle, Secretary to the Ministry of Finance, Sumith Wijesinghe, Chairman of the Ceylon Petroleum Corporation, Buddhika Madigahewa, Managing Director of the Ceylon Petroleum Corporation and Manoj Gupta, Managing Director of the Ceylon Indian Oil Company signed on behalf of the Government of Sri Lanka.

The new agreement nullifies the 35-year agreement on the Trincomalee tanks, which was signed in 2003 and will be divided into 99 tanks for the next 50 years as follows:

  1. Lanka IOC – 14 fuel tanks
  2. Ceylon Petroleum Corporation – 24 tanks
  3. The Trincomalee Petroleum Terminal Company, which was formed by the Ceylon Petroleum Corporation and the Ceylon IOC with a 51% – 49% stake, – 61 oil tanks.

Udaya Gammanpila, Minister of Energy says that under the new agreement, Sri Lanka was able to take control of 85 of the 99 oil tanks, which is a historic victory. The Opposition alleges that Minister Gammanpila has given the oil tanks back to India for another 50 years which could have been acquired by Sri Lanka soon. Also, the Indian media last week questioned how the Ceylon Petroleum Corporation, which has already called it a joint venture or has no money to invest in crude oil, could invest in it.

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