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July 13, 2006 (LBO) - Ceylon Petroleum Corporation has temporarily shelved plans to get back into the gas business, extending a five year agreement with Laugfs Gas that ends in October this year.
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The two sides have been in talks, with the supply agreement to be extended by another two years from October, a top official with the Corporation, told LBO.
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Ceypetco sells Liquid Petroleum Gas, produced as a by-product from its oil refinery, to Laugfs that supplies domestic and industrial consumers.

The refinery produces about 50 to 60 tonnes of LPG a day, with Laugfs Gas importing over 50 percent of its gas requirements to meet local demand.

We have indicated to Laugfs that we will sign the agreement with them and we are currently negotiating terms and conditions, the official said.

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The new agreement is to also include clauses for discounts to domestic users. The local market is currently supplied by both Laugfs and Shell Gas, which has 86 percent of the market.

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The energy intensive ceramics industry was also lobbying Ceypetco to sell supplies directly to them, which would lower costs, but initial discussions fell through.

Ceylon Petroleum Corporation has been toy

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