CPC to modernise oil refinery for USD 600m

Anjana Samarasinghe

MODERNISATION: Ceylon Petroleum Corporation (CPC) is to modernise its oil refinery to facilitate the oil refining process in Sri Lanka and to reduce the oil import bill.

Chairman and Managing Director of the CPC Ashantha De Mel told the media that they import 15 million of

 crude oil barrels and 15 million barrels of finished products (refined products).

In the international market the price of a crude oil barrel is now USD 62 and price of a finished product barrel is around USD 80. If CPC could import much more crude oil and refine them in Sri Lanka country could save large amount of foreign exchange and those benefits could pass on to consumers, he said.

However modernisation project required nearly USD 600 million to complete. Since last year Government has stopped subsidising CPC and Corporation need to find necessary funds for the project.

CPC cannot run at a loss by providing fuel for a cheaper price and we need to increase the price to find money for these projects as well as the survival of the Corporation, he said.

De Mel also said that they are negotiating with the Treasury on seeking funds for the project.

Apart from the oil refinery modernising project CPC needs to modernise their pipeline systems and fuel stations to increase the efficiency and reduce unnecessary cost. CPC also need to modernise petrol pumps and purchase more fuel bowsers to uplift the distribution process, he said.