ECONOMYNEXT – Sri Lanka has called for expressions of interest from foreign investors in petroleum producing countries to import and distribute fuel in the island, as the country reels from foreign shortages.
The investors should agree to import and sell oil using their one funds without buying dollars in the domestic market for an unspecified period of time.
The company should have a “sound financial viability and should posses the ability of importing petroleum products by utilizing their own forex for an agreed period without dependency on Sri Lankan foex market,” the EOI said.
Sri Lanka’s CPC is now heavily in debt after getting into debt and selling oil exposed to a unhedged forex risk when the central bank printed money and created forex shortages under flexible inflation targeting out output gap targeting despite operating peg.
The selected companies will be required to enter into an agreement with state-run Ceylon Petroleum Corporation.
The companies will be allowed to use existing CPC filling stations and also its common user terminal (Ceylon Petroleum Storage Terminals) for a fee initially.
“The Ministry of Power and Energy will facilitate the development of new fuel stations and storage terminals depending on the requirement of the company post commencing operations in Sri Lanka,” the EOI said.
The government will hold a pre-bid conference on August 05.