CPC to increase jet fuel imports
Sri Lanka’s state-owned Ceylon Petroleum Corporation (CPC) is devising plans to increase its jet fuel imports in the next two years anticipating a rise in domestic demand in the aviation sector, an official procurement plan revealed.
The CPC will increase jet fuel imports by 38.33 per cent to 593,440 metric tons next year and in addition 7.4 per cent more to 635,820 metric tons in 2022.
According to official documents, CPC has no alternative other than importing refined petroleum products to meet the local demand as the production at the Sapugaskanda oil refinery is insufficient to tackle the demand.
The Government has to expedite the procurement process of fuel imports as the CPC refinery has to shut down for maintenance once in every two years.
The present production output at the refinery is around 40,000 barrels per day which is sufficient to meet 25 to 30 per cent of the domestic demand and the balance will have to be imported, official sources said.
The government has already given the green-light for CPC to resume the long, planned project to expand crude oil processing capacity of its refinery at Sapugaskanda.
The proposal of CPC has received recently the Cabinet of Ministers’ approval to devise a new feasibility study to determine the scope, technical, operational, and financial feasibility of the planned 100,000-b/d expansion. It will also focus on several alternative proposals to enhance the refinery’s existing capacity.
The sales volume of Ceylon Petroleum Corporation (CPC) declined by almost 20 per cent to 3,367 million litres for the first eight months of 2020, compared to 4,211 million litres in the same period of 2019, a Treasury report revealed.
Accordingly, the revenue of the CPC dropped almost by Rs. 96 billion while the cost of sales declined by 22 per cent to Rs. 311 billion.
In fact as the CPC’s overall performance is highly linked with the exchange rate fluctuations, coupled with the exchange rate variations, its’ overall loss for the first eight months of 2020 reached Rs. 4.4 billion, the report disclosed. As the average crude oil price remained below US$43 per barrel, the total import cost of the CPC during the first eight months of 2020 declined to around $1,126 million, it added.