Getting Nowhere

Shell Gas Lanka Ltd, a unit of Royal/Dutch Shell Group, is seeking for some ’emergency tsunami aid’ from the Sri Lankan government, after six months lag on price hikes, blew a Rs. 350 mn hole in its balance sheet last year, top officials said. Shell Gas Lanka Ltd, a unit of Royal/Dutch Shell Group, is seeking for some ’emergency tsunami aid’ from the Sri Lankan government, after six months lag on price hikes, blew a Rs. 350 mn hole in its balance sheet last year, top officials said. Tsunami hit Sri Lanka picked up US$ 500,000 out of the US$ 3 mn loot allocated by Shell Global to tidal wave affected countries.

But Shell’s Sri Lankan unit is battling a ‘mini tsunami’ of its own.

Despite clocking in Rs. 6 bn in revenues, Shell says a lag in prices and a weak rupee took the shine off its results in 2004.

Shell had posted a Rs. 26 mn loss in 2003, but went on to skate on thin ice the following year, after global Liquid Petroleum Gas (LPG) prices climbed up to US$ 470 per tonne. However, prices are expected ease off to about US$ 370 per tonne this year.

While global LPG prices swayed between US$ 265 to 470, the usually cash strapped Sri Lankan government stepped in with a Rs. 200 mn subsidy for a few months, to keep the multinati