Cabinet approval for CPC to enter LP Gas industry

Nadira Gunatilleke

COLOMBO: Cabinet approval has been granted to a Memorandum submitted by Petroleum and Petroleum Resources Development Minister A.H.M. Fowzie to enable the Ceylon Petroleum Corporation (CPC) to enter the Liquid Petroleum Gas (LPG) and Lubricant business, Information and Media Minister and Cabinet Spokesman Anura Priyadarshana Yapa said.

Addressing the weekly Cabinet press briefing at the Government Information Department Auditorium yesterday, Yapa said the country's present LPG requirement is about 160,000 MT per annum.

Of this total LPG consumption, nearly 75 per cent is for domestic use and the balance for industrial use.

There is a tendency for an increase in the demand for LPG and therefore it is appropriate for the CPC to enter into LPG retail business as a local producer of LPG and also as a means of creating fair competition in the business, he said.

The Minister pointed out that the Sapugaskanda Refinery produces about 18,000 MT of LPG per annum which is 10 per cent of the current demand.

After completion of the gas recovery project at the refinery, CPC will produce 36,000 MT which will be about 20 per cent of the country's requirement, he said.

The CPC had been in this business for more than three decades since the inception of the Corporation.

The CPC Lubricants Unit was sold to Caltex Ltd by previous regime, the Minister said.

The CPC has called for Expression of Interest from qualified companies for a joint venture to re-enter the lubricant market under the brand name `Ceypetco'.

The normal procedure will be followed in granting a licence to engage in lubricant business, he said.