CPC buys 40,000 tons fuel oil from little-known supplier

Thursday, 23 August 2012 00:08 - - {{hitsCtrl.values.hits}}

SINGAPORE (Reuters): Ceylon Petroleum Corp (Ceypetco) has awarded a tender to buy 40,000 tons of fuel oil to a little-known company called Bumi Siak Pusako, industry sources said.

Ceypetco bought 15,000 tons of Low Sulphur Fuel Oil (LSFO) at a premium of $ 84.95 a ton, above Singapore spot quote, for 29-20 August delivery to SPM Muthurajawela.

The other 25,000 tons are High Sulphur Fuel Oil (HSFO), which Ceypetco purchased at a premium of $ 69.95 a ton, above Singapore spot quote, for delivery over 29-20 August to Dolphin Pier.

Bumi Siak Pusako is an Indonesian Riau Province-owned company. Earlier this year, it reached an agreement with Bangladesh Petroleum Corporation (BPC) to supply 80,000 tons of fuel oil in 2012 to meet growing power generation demand.

Traders, however, said that they know little about the company. “I haven’t heard much about them in the market,” said a Singapore-based fuel oil trader.

Ceypetco restarted its 50,000 barrels per day (bpd) Sapugaskanda refinery on the outskirts of Colombo on 10 August, following a planned maintenance that started on 2 July.

The shutdown prompted the refiner to seek additional oil products to meet domestic shorts. So far, it has bought 70,000 tons of LSFO and 85,000 tons of HSFO through spot tenders.