CPC stuck with Rs.2.5 billion stock of furnace oil


By Ifham Nizam

The Ceylon Petroleum Corporation (CPC) would have no choice but to re-export at a lower price, the existing stock of 50,000 MT of Low Sulphur Furnace Oil which is estimated to be worth Rs. 2.5 Billion, a senior official said.

 The stock had been for the generation of thermal power, but a senior engineer of the Ceylon Electricity Board (CEB) told The Island that they no longer needed thermal power inputs from the Independent Power Producers (IPPs), especially with a high intake of cheap coal power and hydro power in meeting the country’s electricity demand.

Earlier this week, CPC Chairman Ranjith Wickremasinghe discussed with Kerawalapitiya Plant officials and others on providing Low Sulphur Furnace Oil at a cheaper price.

The Island reliably understands that the CPC has told Kerawalapitiya Plant officials it could provide fuel at Rs. 75.00 per litre. Until recently it was provided between Rs. 100 and Rs. 90 a litre.

 However, they too were not keen in having fuel due to the current power surplus as a result of the country’s first coal fired power plant at Norochcholai producing maximum output having overcome its initial technical problems.

 It is understood that the CPC Chief wants to dispose the oil stock as soon as possible due to limited storage facilities.

An engineer said that in case CPC decided to export it, with the current low price of fuel in Singapore it would have to sell the stock of Low Sulphur Furnace Oil at a much lower price.

Meanwhile, others believe that Power and Energy Ministry by resorting to an energy mix in generating power should get rid of the existing additional stocks.

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