Colombo, Mar 27 (PTI) Sri Lanka's Cabinet has approved a proposal to liberalise the fuel retail marketing by allowing more players from China, Australia and the US to enter the market.
The island nation’s fuel retail market was a state monopoly under the Ceylon Petroleum Corporation (CPC) till 2003 when the Indian Oil Corporation was allowed to operate.
Energy Minister Kanchana Wijesekara tweeted: “The Cabinet approval granted to award licenses to Sinopec, United Petroleum Australia and RM Parks of USA in a collaboration with Shell Plc to enter the fuel retail market in Sri Lanka.”
Wijesekara added that the energy committee and procurement committees had approved a recommendation to award the three companies the licenses to operate.
They will be allocated 150 dealer-operated fuel stations which are currently being run by the state fuel entity the Ceylon Petroleum Corporation.
“They will be granted a license to operate for 20 years to import, store, distribute and sell petroleum products in Sri Lanka,” the minister added.
Lanka IOC (LIOC), the Indian Oil Corporation's subsidiary in Sri Lanka, proved a welcome addition when the CPC was gripped in the economic crisis and imports were not possible due to the forex shortage last year.
The fuel sector trade unions, who opposed the deal with the IOC, say they are opposed to the new liberalisation policy in the fuel sector.
The LIOC by mid-last year was enjoying a 16 per cent market share for petrol and diesel.
For lubricants, bitumen, and oil bunkering their market share was over 35 per cent.