CPC cancels Nigerian crude oil contract over non-performance
Following the failure to supply a stock of crude oil on time, the Ceylon Petroleum Corporation (CPC) has cancelled a contract granted to M/s Conscio Ltd, Nigeria to import Murban crude oil over nine months, the CPC said.
This Nigerian company had entered into an agreement with the corporation to supply 2,062,500 barrels of crude oil for the period June 2021 to February 2022 in several shipments in accordance with the requirement but it has not performed accordingly, CPC chairman Sumith Abeysinghe told the Business Times. Not a single shipment has been received so far forcing the closure of the Sapugaskanda refinery for 50 days since last month.
M/s Conscio Ltd, Nigeria was among the several new suppliers registered with the corporation he said adding that the contract was awarded following proper procedures.
The Murban crude oil tender for nine months has been cancelled and a new tender was awarded to Swiss Singapore International with effect from December 2021, Mr. Abeysinghe disclosed.
The delay in the crude oil shipment from Nigeria would not affect fuel supplies, he said pointing out that M/s Conscio Ltd, Nigeria has even paid the bid bond although it has not adhered to the contract.
The 51-years-old refinery produces 37 per cent of furnace oil and naphtha, 19 per cent of jet fuel and 43 per cent petrol and diesel.
There is no urgency to import crude oil because 56 per cent of it is used for producing furnace oil and jet fuel, Energy Minister Udaya Gammanpila pointed out
Foreign exchange reserve allocations for crude oil can be used to import petrol, diesel, medicines, food, gas and other essential goods under the present economic situation, he said adding that necessary action will also be taken to resume oil refinery operations soon after receiving the next shipment.
The Minister noted that there were stocks of 13,500 tons of furnace oil produced from a previously imported crude oil stock and it can fulfill the Ceylon Electricity Board’s thermal generator requirement.
Accordingly the available petrol reserves would be sufficient until January 2022 but the diesel storage is rapidly depleting at present, CPC records revealed.
The Singaporean company Vitol Asia Pvt Ltd has received a long-term contract to supply diesel and petrol for the first eight months of next year.
The Cabinet has taken a decision to import 1,137,500 barrels of diesel and 262,500 barrels of diesel, officials said, adding that approval has also been granted to import 1,341,000 barrels of Octane 92 petrol and 459,000 barrels of Octane 95 petrol.
Negotiations to purchase oil from the UAE had ended in a deadlock while the Energy Ministry and the CPC are grappling to find foreign exchange for oil imports through foreign loans, a senior official of the Finance Ministry said.
Hitad.lk has you covered with quality used or brand new cars for sale that are budget friendly yet reliable! Now is the time to sell your old ride for something more attractive to today's modern automotive market demands. Browse through our selection of affordable options now on Hitad.lk before deciding on what will work best for you!