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CPC  embroils in financial crisis at a time of dollar shortage   

Despite the repeated requests of Energy Minister Udaya Gammanpila to increase fuel prices due to high oil prices in the world market, the government has decided to maintain fuel prices at current levels.

This decision was taken at the special cabinet meeting held on Tuesday 22. Although the price of a crude oil barrel in the global market now stands at US$ 99 the cabinet decided that the current fuel price rates should be maintained, after taking into account the issues faced by the general public.

It was also decided the government will settle an outstanding payment of Rs.80 billion owed to the Ceylon Petroleum Corporation for the continuous supply of fuel.
The CPC has deployed several inspection teams in search of filling stations that have stockpiled stocks without issuing them to consumers.

It will take a decision in the future regarding filling stations that conceal stocks and refuse to issue fuel to consumers, Sumith Wijesinghe, the Chairman of the CPC said.
“The daily supply of Diesel, which is usually around 6000 metric tonnes, rose to 8000 to 9000 metric tonnes in the past few days,” he added.  

The Ceylon Petroleum Corporation has a debt burden of Rs.750 billion at present including dues of Rs 370 billion to two state banks. , official data showed.  
 The two banks have rejected the CPC request to grant another loan facility of Rs.10.36 billion to import fuel but it has turned down due to its borrowing limit from banks already exceeded.  

The total loss of the CPC at present was over Rs.110 billion and daily loss was Rs 550 million, Minister Gammanpila disclosed.

CPC chairman Sumith Wijesinghe has balamed the previous management for this financial debacle of the corporation.  
 However, according to the CPC financial division, a sum of Rs. 250 million  to Rs 300 million  will be spent to pay overtime of employees and it pays bonuses three times per year amounting Rs. 1.5 billion.

Under these circumstances CPC has become a white elephant,a senior official said, adding that something has to be done to remedy this precarious financial situation.
In the midst of the country’s dollar and economic crises, the CPC  seems to be exploiting the situation in their favour  by importing oil without a procurement system, Opposition MP Eran Wickremaratne alleged.  

Oil is purchased from anyone who submits non-solicited proposals without registering as suppliers and obtaining prior qualifications.It is very easy to commit theft and corruption by conniving with suppliers when purchasing fuel deviating from laid down proper procurement process.

Mr. Wickremaratne said that the government’s attempt to increase fuel prices to cover up the losses caused by these corruptions and commissions was unacceptable.
As rising oil prices affect all sectors, rising prices of all commodities, including transport costs, could not be avoided, and the inflation would also increase sharply  
As the government has no effective solutions,  the government is unable to prevent the crisis from exacerbating rapidly, he claimed. 

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