New foreign entrants to local fuel retail market to begin operations within two months

By Rathindra Kuruwita

The three foreign companies selected to enter the fuel retail market would commence operations within the next two months, Minister of Power and Energy, Kanchana Wijesekera told journalists in Colombo yesterday.

Wijesekera said that agreements would be signed with these companies within the next two to three weeks.

The minister said that the three companies were keen to commence operations in Sri Lanka and had requested the government to fast-track the process.

The state-owned Ceylon Petroleum Corporation (CPC) currently operates 1,142 filling stations.

The CPC directly operates 234 stations, and others numbering 908 are run by dealers.

The three foreign companies would be given 450 gas stations (150 each) from the 908 operated by local dealers, he said.

The Cabinet last week agreed to award licences to more foreign companies to engage in fuel retail market, Wijesekera said.

China’s Sinopec, United Petroleum of Australia and RM Parks of US in a collaboration with Shell Plc will enter the fuel retail market in Sri Lanka.

Wijesekera said the Energy Committee and other procurement committees had given approval for awarding operating licences to these companies.

The minister added that the companies would be permitted to import, store, distribute and sell petroleum products in Sri Lanka for 20 years.

The companies will also be allowed to establish 50 new gas stations each in new locations.

Currently, the only two players in Sri Lanka’s market are Ceylon Petroleum Corporation and Lanka IOC.

Sri Lanka has tried to encourage foreign companies to enter the domestic fuel retail market amid its economic woes.