New state company enters LPG business
View(s):Litro Gas Lanka and Laugfs Gas PLC which dominate the LPG business in
Sri Lanka will lose their oligopoly status with the entry of a state-owned entity before the end of this year.
While Laugfs is totally private, Litro is owned by state insurer Sri Lanka Insurance Corporation.
Preliminary arrangements have been made to establish a new company – SIYOLIT (Pvt) Ltd – as an affiliate of the Ceylon Petroleum Corporation (CPC) and which will sell LPG under the brand name ‘SIYOLIT’, Energy Minister Udaya Gammanpila said.
The new state entity will produce LPG and also import and sell it to the domestic market at competitive prices beneficial to the consumer, he disclosed to the Business Times.
The CPC which currently manufactures approximately 5 percent of
Sri Lanka’s LPG and sells it to Litro and Laugfs for distribution, will now supply it to its affiliated firm for sale and distribution.
The new company will have an 8-member board of directors under the chairmanship of L.A.S. Silva who has already been appointed with the Treasury as a shareholder.
Director General of the Public Enterprises Department of the Finance Ministry P.A.S. Athula Kumara is the director representing the Treasury.
A sum of around Rs.10 million will be spent monthly for the maintenance and functions of the board of directors initially till the launch of the company, official documents showed.
Private investors would also be given shares in the new company, a senior official of the Treasury said.
Meanwhile the Ministry of Energy is taking steps to set up a new oil refinery in Sapugaskanda which once complete can produce nearly 20 percent of the country’s LPG demand, the Minister said.