Oil Deal

Dec 15, 2008 (LBO) – Sri Lanka’s Supreme Court barred a senior official from a state-run petroleum retailer over a case involving derivative deals and said the country’s central bank has to probe and solve the case.

Supreme Court asked the central bank to file a preliminary probe report brought to court Monday, with the court registrar under sealed cover after first questioning why a report was brought to court.

Court ruled that the General Manager-Finance of Ceylon Petroleum Corporation, Lalith Karunaratne should keep away from the corporation, after a petitioner said documents on the hedging deals were endangered due to his continued presence.

CPC’s chairman was suspended earlier, by Chief Justice Sarath Silva.

Court also asked the central bank to impound documents relating to the foreign travel of public officials paid for by the Standard Chartered Bank which a petitioner said was kept at the bank, but was in danger of being lost.

On November 28, the Supreme Court suspended payments on a series of oil derivatives sold to state-run Ceylon Petroleum by Citibank, Standard Chartered, Deutsche Bank, and two local banks, Peoples’ Bank and Commercial Bank.