Slippery Deals

The government is in the final stages of negotiation with a US based company interested in building a new oil refinery adjoining the one it operates on the outskirts of the capital. The government is in the final stages of negotiation with a US based company interested in building a new oil refinery adjoining the one it operates on the outskirts of the capital.

Ceylon Petroleum Corporation (CPC) is offering a carrot to an investor by way of the use of its infrastructure like pipelines from the port and storage facilities.

A sharing agreement could also get the government a stake in the project. Around two thirds of the islands fuel requirement or 50,000 barrels a day is refined at the current facility.

The American investor has offered to build a refinery capable of handling 100,000 barrels a day if its offered use of some of CPC’s existing infrastructure.

“A technical evaluation committee has been appointed to negotiate with the financiers. But no letter of intent has been awarded but it is in the process,” Jaliya Medagama, Chairman, Ceylon Petroleum Corporation told a news conference last week.

Sri Lanka consumes around 3 .6 million tons of fuel every year.