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Sapugaskanda Refinery closed for 50 days

15 Nov 2021

 
  • Gammanpila notes forex reserved for imports of other essentials
  • Denies any fuel crisis as fuel will be imported
  • Union counters, saying refining oil cheaper than importing fuel
  BY Pamodi Waravita Energy Minister Udaya Gammanpila said yesterday (15) that the Sapugaskanda Oil Refinery will be temporarily closed for 50 days as the country’s limited foreign exchange needs to be utilised for the import of other essential items, while the CPC trade union suggested that this move could drive up fuel-related costs instead of reducing them. “From yesterday (15), the Sapugaskanda Oil Refinery was closed temporarily, for at least 50 days. We have taken this decision as we want to properly manage the limited foreign exchange in the country and use that for the import of essential items only. The Sapugaskanda Refinery is 51 years old. In terms of production, 37% is furnace oil and naphtha, 19% amounts to airplane fuel and kerosene oil, 14% accounts for petrol, and 29% for diesel. The Power Ministry has informed us that electricity is being mostly generated through hydro these days and thus, it does not need furnace oil. Only long-distance airplanes need fuel from Sri Lanka and this is not in increased demand these days. We can import petrol or diesel, instead of importing crude oil and refining it here, which will help us better manage the foreign exchange crisis. As such, there will not be a fuel crisis,” said Gammanpila, addressing the media yesterday.  However, Jathika Sevaka Sangamaya (JSS) Ceylon Petroleum Corporation (CPC) Branch President Ananda Palitha, speaking to The Morning yesterday, claimed that it is cheaper to import crude oil and refine it, instead of importing petrol and diesel. “It is about $ 15 cheaper to import a metric tonne (MT) of crude oil. Through signing deals to directly import petrol and diesel, corrupt individuals will be able to get a commission,” alleged Palitha. At the media conference yesterday, Gammanpila alleged that a former CPC employee routinely lies to the media, and tries to create a fuel crisis in the country. “We are currently in discussions with several countries to obtain loan facilities. According to the current prices, we need $ 350 million for fuel imports per month. Sri Lanka is currently at a weak position in terms of obtaining loan facilities. Once this foreign exchange crisis is solved, we will import crude oil again,” he assured.  Sri Lanka is currently grappling with a severe foreign exchange crisis, alongside reported shortages of several essential items, including sugar, milk powder, and liquid petroleum gas.


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