Dirty fuel supplier back in business

Hard on the heels of last week’s Sunday Times report that the fuel supplier involved in importing substandard petrol was engaged in the tender involving the import of diesel supplies, the Ceylon Petroleum Corporation (CPC) has called for yet another hurried tender this week and the same supplier is once again involved in the tender.

The CPC has called for a tender for the supply of 150,000 tons of Low Sulphur Fuel Oil (LSFO) fixing tomorrow as the closing date and the supplies commencing in 10 days time.

The CPC advertised for the supply of this fuel in four instalments of 35,000 tons every six weeks. How the CPC’s arithmetic added up these four instalments to 150,000 tons when it should be 140,000 tons is not clear.

This company, Vitol of Singapore which was reinstated as a supplier after it was blacklisted for importing inferior quality petrol on a previous occasion has been allowed to continue supplies even before an official committee probing the contaminated fuel deal is to finalize its report.

Sandya Wijayabandara, Acting Secretary of the Petroleum Ministry defended the CPC’s granting of tender awards at short notice. She said, “The main reason for the short notice given for imports is that the Ceylon Electricity Board needs urgent supplies of Low Sulphur Fuel Oil for power generation. Since urgent supplies are needed we have to expedite the imports”.

Mrs. Wijayabandara also defended the move to lift the ban on the company which was previously blacklisted for importing substandard fuel. “The normal procedure is that in the event an offence is committed a penalty is imposed and the can continue in business. That is the usual trade practice. It has been the same practice followed in this case. The restriction on Vitol has been lifted. This was a decision taken by the CPC Board”, she said.

Meanwhile, another tender for the supply of bulk bitumen was announced by CPC this week. This was for the 'expression of interest' for a joint venture partnership with the CPC for import, storage and sale of bulk bitumen including necessary infrastructure.

The tender closes on August 30, 2011 giving little time for a serious contender to furnish the required details. A CPC source said "it is clear that somebody has been already lined up" for the job. In a recent tender for the supply of 300,000 barrels of gas oil tenders were to close on August 16, 2011, and delivery in Colombo was fixed for August 22 and 23.

Due to the short dates given several registered parties did not tender and only two parties tendered. After they were awarded the tender however, the date of delivery was extended to September 1 and 2.

The CPC was aware that delivery was acceptable on 1st/2nd September, but it was not announced in advance, a CPC source told the Sunday Times.. The report of the official committee that is probing the contaminated fuel imports that ruined over 2,000 cars is still to be finalized over a month after the fiasco.

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