Laugfs Gas Chairman W.K.H. Wegapitiya yesterday reacted cautiously to reports that his company is looking at acquiring the Shell Gas business in Sri Lanka.

"We are the most capable and suitable contender," he said. "Something is happening but it is too early to say anything."

Earlier Wegapitiya was quoted on a website, Vimasuma.com, saying that his company’s representatives were holding talks in London with Shell officials on buying Shell’s Sri Lanka business.

"We’re keen on buying Shell’s operation in Sri Lanka and our representatives are holding talks with Shell in London," Wegapitiya told our sister news website Vimasuma.com.

Shell has already revealed that it is in talks with possible buyers reviewing "ownership options" for most of its LPG units in Europe, Asia and Latin America and has already sold businesses in India in April and confirmed plans to sell LPG interest in Pakistan.

The preferred outcome of the process is the sale of the businesses "as going concerns, through a number of phased portfolio actions," Shell said.

Shell is looking at exiting the LPG business to focus on oil exploration and production.

No Shell Gas spokesman was available for comment yesterday.

Both Shell and Laugfs were permitted price increases last week by the Consuer Affairs Authority, the regulator.