President appoints new subcommittee to call for fresh oil tenders

Thursday, 10 March 2016 00:00 - - {{hitsCtrl.values.hits}}

By Chamodi Gunawardana

President Maithripala Sirisena has appointed a Cabinet subcommittee to call for new oil tenders for lower prices, Petroleum Resources Development Minister Chandima Weerakkody said yesterday.

Speaking at the Sri Lanka Freedom Party (SLFP) weekly media briefing, he said the Government expects to remove the traditional buying methods of fuel oil.

The move comes amidst allegations the Government is paying above market prices for spot purchases and has given tenders to a company with no experience in oil sales.

“The fuel market has been controlled by a few major buyers and it is a barrier to buy oil for reasonable prices. The subcommittee will introduce new tender systems to buy oil via transparent transactions,” Weerakkody assured.

He added the Government was working on the preparation of pricing formula for fuel to pass on concessions from decreasing international prices to the public.

Responding to questions on why the Government has been unable to reduce fuel prices despite lower prices in the international market, Weerakkody said officials were working on redeveloping the country’s economy and this was getting precedence over giving temporary concessions.

He also noted the Ceylon Petroleum Corporation (CPC) had obtained Cabinet approval to open a State-owned lubricant manufacturing company to avoid the high expenditures on lubricants.

“The suggested lubricant manufacturing centre will commence within the next two weeks. We have invested $ 13 m for the entire project,” he noted.

Commenting on the progress of oil and gas exploration project on east coast in collaboration with Total S.A of France, Weerakkody said Total is seeking sub-contractors to start the project.

“Total has invested $ 25m for this project and we signed a Joint Study Agreement of two years to complete the venture,” he stated.