ECONOMYNEXT – China’s Sinopec has commenced discharging its first shipment of fuel to Sri Lanka with a second shipment due to arrive on Thursday August 03, Energy Minister Kanchana Wijesekara said.
The minister tweeted on Tuesday August 01 that the entry of new retail suppliers to the domestic market will ease the forex requirements for petroleum products as the suppliers will bring in products on a 12 month financing facility from their principal investors with no forex requirements from the domestic financial institutes.
“Sinopec will commence retail petroleum operations with 150 fuel stations islandwide once the agreements with the fuel station dealers are signed and finalised,” he said.
Sinopec, China’s state-owned petroleum corporation, is among three foreign players who have signed contracts to enter the Sri Lankan market.
A contract agreement was signed with Sinopec in May to distribute fuel locally through 150 filling stations first to ensure a steady and uninterrupted fuel supply in Sri Lanka.
President Ranil Wickremesinghe’s administration has decided to sell government stakes in seven key state-owned enterprises (SOEs) including loss-making fuel retailer Ceylon Petroleum Corporation (CPC). Restructuring SOEs has been high on the agenda of the Wickremesinghe government as part of its reform plans consequent to finalising an agreement with the International Monetary Fund (IMF) for a 2.9 billion US dollar extended fund facility.
Meanwhile, the government is also said to be planning a price ceiling for fuel.
“Companies can sell at the price of their choice, subject to the maximum limit. There will be competition. If one company reduces the price, and others follow, there will be a big benefit,” State Minister for Energy D V Chanaka said on July 24.
Sri Lanka’s state run Ceylon Petroleum Corporation raised the price of 92 Octane petrol by 20 rupees to 348 rupees, effective from July 30 midnight.
Petrol Octane 95 was also increased by 10 rupees to 375 rupees a litre, while Super Diesel was increased by 12 rupees to 358 rupees per litre. Auto Diesel was reduced by 2 rupees to 306 rupees, while the price of kerosene was reduced by 10 rupees to 226 rupees. (Colombo/Aug02/2023)