June 28, Colombo (LNW): Sri Lanka seeks a suitable investment partner, explore option of relocating Sapugaskanda Oil Refinery to be operated as government joint venture
The Government has called for expressions of interest to operate the Sapugaskanda Oil Refinery as a public enterprise independent of the Ceylon Petroleum Corporation (CPC).
“The rationale behind the move stems from the necessity of a ‘critical investment’ to modernise and upgrade the ageing infrastructure of the refinery. The aim is to ensure its operational efficiency and viability for at least another 25 years,” the Government Information Department noted.
Minister of Power and Energy Kanchana Wijesekera said that under the Ceylon Petroleum Corporation (CPC) restructuring plan, the CPC-owned refinery will be set up as a separate Government-owned and operated entity to attract and raise investments with the aim of improving fuel quality, efficiency, capacity, and reducing costs.
In a post on social media, he said that the restructuring plan includes revising the currently approved cadre and salary structure of the CPC while digital platforms will be introduced for multiple functions and service
The government’s aim is to get rid of the country’s only oil refinery with a capacity to supply 100percent of the country’s kerosene requirement, 50 percent of the aviation fuel requirement, and100 percent of the naphtha requirement.,
It was used to produce 30 percent of the diesel requirement, 14percent of the petrol requirement, 7-8percent of the gas requirement, and 75-100percent of the furnace oil requirement.
Initially designed to process 38,000 barrels of crude oil, the refinery currently has a capacity of refining about 50,000 barrels per day.
Sapugaskanda Refinery was built by Iran under the guidance of the Ceylon Petroleum Corporation (CPC) in August, 1969.
A senior engineer of the CPC said that the closure of the Sapugaskanda Oil Refinery would cost the country an additional sum of US$ 1.1 million a day to meet its crude oil requirement.He further claimed “The refinery has been shut down on several occasions and it has cost a lot of money to resume its operations. This was a national crime, he added
