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Joint plan to revive China Bay oil farm
View(s):Some 85 huge oil tanks – currently left unused – at China Bay oil farm in Trincomalee are to be revived if Cabinet approval is given for a request made by the Petroleum Resources Development Ministry.
Ceylon Petroleum Corporation Chairman T.C. Jayasinghe said yesterday that the Ministry hoped to use 15 of the tanks for bunkering and storage facilities while the remaining 70 would be hired out to a joint venture involving the CPC, the Ceylon petroleum Storage Terminal Ltd and the Lanka Indian Oil Corporation.
He said initial studies had been conducted by CPC experts to assess the condition of the tanks, the infrastructure, piping systems and a business model for their revival. The CPC experts have proposed two options – one with 18-inch pipelines and the other with 12-inch pipelines. But the ministry appears to prefer the 18-inch pipeline for the project which was estimated to cost US$ 12 million.
Mr. Jayasinghe said 15 tanks to be run by the CPC had a storage capacity of 150,000 MT. This would enable the CPC to import oil when prices were low and store them at the Trinco tanks for future usage.
Petroleum Minister Chandima Weerakkody said discussions were taking place with the LIOC relating to the use of the other 70 tanks for business purposes. Mr. Weerakkody said they had secured the clearance from the Attorney General’s Department for the deals.
In 2002, the Sri Lankan Government permitted the use the tank farm for the LIOC. Since then the LIOC has operated some of the lower tanks in the farm along with eight newly constructed tanks used for base oil storage and another two new tanks for the storage of gasoline.