CPC’s off-specification syndrome

By S. Talpahewa,

Former Chairman/Managing Director, Ceylon Petroleum Corporation.

Continued from yesterday

Contamination of a product, after inspection on board at the discharge port and found within specifications, can occur in the discharging pipelines, terminal storage tanks with sludge and other foreign material accumulated over a period of several years and en route to end-users’ storage facilities. By a process of elimination the root cause can be ascertained and proper action taken against those who are responsible. Taking hasty decisions, such as blacklisting of suppliers without proper investigations, and without listening to "both sides of the story", for the mere satisfaction of the egos of certain individuals, can lead to unnecessary litigation, financial losses and the loss of face for the CPC.

b) Second Fiasco - "THE DIRTY PETROL EPISODE" should have opened the eyes of both the

Petroleum Industries Ministry and CPC officials as to the fact that what would happen when

time-tested purchasing procedures are by-passed and purchases of petroleum products and

services made from favourites of certain politicians under the guise of those chosen parties

being fully owned by respective governments.

The CPC, having deviated from the time tested procedure, dealt with ENOC, Singapore in importing a cargo of gasoline in 2011, which resulted in thousands of petrol driven motor vehicles being stalled on the highways and CPC having to pay compensation running into several billions of rupees to the owners of those affected vehicles, in addition to the image of the CPC being tarnished internationally. The Commission to Investigate Allegations of Bribery and Corruption is now inquiring into that incident. Some newspapers gave minute details of that scandalous transaction and the only irresistible inference one can draw from such information given in those newspaper articles, which were not challenged either by the Petroleum Industries Ministry or the CPC, is that ENOC willfully supplied the CPC with an off-specification cargo of gasoline seemingly with the knowledge of certain officials of the CPC and the Ministry of Petroleum Industries. A supplier of the calibre of an Oil Major, such as British Petroleum, Shell, Chevron and/or any other reputed supplier, whether fully owned by a government or otherwise, would not have stooped to such a level of sharp practice to collude with unscrupulous local officials in disposing in that manner of a stock of unsuitable refined petroleum product, perhaps they were saddled with.

Had the CPC followed the time-tested purchasing procedure and/or the line Ministry allowed the CPC to adhere to the said purchasing procedure, CPC would not have faced such an embarrassing situation as they did in the case of that infamous "DIRTY PETROL FIASCO".

Ironically the supplier, who supplied "Dirty Petrol" to CPC willfully has not been removed from the list of registered suppliers of the CPC whilst a supplier who supplied High Sulphur Fuel Oil strictly in conformity with specifications as stipulated by CPC in relevant tender documents was suspended and subsequently reinstated as described above obviously to cover the lapses of certain CPC officials! What is sauce for the goose is not the sauce for the gander at the CPC and favouritism (and/or nepotism?) appears to be reigning at its very height.

c) Third Fiasco - Much publicity was given in the media, both print and electronic in May 2012 to a consignment of Jet A1 Fuel (Aviation Fuel Oil) imported by the CPC from British Petroleum Singapore Pte. Ltd., Singapore, which was said to be off-specifications. The "Off-Specification" syndrome appears to be fast spreading within the corridors of the local petroleum industry, whenever a consignment of refined petroleum product arrives in Colombo, sold by an international trader. Even before the official announcement of such an off-specification of a petroleum product or products some local agents of the supplier/s concerned appear to get the information through the grapevine or otherwise.

I do not carry a brief for British Petroleum and that since I relinquished my duties with the CPC in May, 1993 I have had no dealings with them. Nevertheless, as a person, who has had experience in the oil industry for more than three decades, I wish to make my comments in the interest of the local oil industry. Beside my service at the CPC, I have served as a member of the Fuel Purchasing Committee of the then Air Lanka and during my service with the CPC and the then Air Lanka I had the opportunity to deal with British Petroleum. British Petroleum is one of the largest, if not the largest, supplier of Jet Fuel (Jet A1) in the world market. They supply Jet Fuel to Air Ports around the Globe for refueling Commercial and Military Air Craft. They pay great attention to ensure that their products meet with international standards and are free of contamination. It is in this context that I am making my comments.

Continued tomorrow

 Hits: 4     Send to Friend