News
Oil tanks: CPC ordered to form new company ahead of Cabinet nod
Energy Minister Udaya Gammanpila has instructed the Ceylon Petroleum Corporation (CPC) Chairman to form a subsidiary company to manage the oil tanks in Trincomalee ahead of obtaining Cabinet approval.
The Minister in a communication to CPC chairman Sumith Wijesinghe has said he had been instructed by President Gotabaya Rajapaksa to form the company first and then obtain cabinet approval.
The President’s Office and the Energy Ministry Secretary have also been informed about the directive issued to the CPC chairman.
The Sunday Times learns that the CPC Chairman has already referred the directive to relevant sections, including the legal division, to expedite the setting up of the oil tank management company.
The new company will be named as Trinco Petroleum Terminal Ltd and the move comes as the Energy Ministry continues talks with Lanka-Indian Oil Company (LIOC) .
The CPC Chairman told the Sunday Times talks on the tank farms with the LIOC were ongoing and had not been finalised yet, but he gave no details. Commenting on the proposed business plan for the China Bay oil tank farm, Ministry Secretary K.D.R. Olga said a final agreement was yet to be reached.
Energy Ministry sources said Indian stakeholders were not in agreement with the proposal to give 14 oil tanks from the China Bay Lower Tank Farm to the Indian Oil Company (IOC), 24 oil tanks from the Upper Tank Farm to the CPC and the remaining 61 tanks to be run as a joint venture between the IOC and the CPC.
Under the joint venture proposed 51 percent would be owned by the CPC and 49 percent by the IOC. Sources said the 14 tanks from the Lower Tank Farm were to be handed over to the IOC on a 99-year lease.
Last Monday, the Minister had a meeting with CPC trade unions and informed them of the Government stance regarding the China Bay Oil Tank Farm. The JVP-affiliated Petroleum Common Workers Union is strongly opposing the move.
Also opposing the move are the CPC Engineers’ Union and the Executive Officers’ Union.
On November 5, the Energy Ministry Secretary asked the Surveyor General to expedite the survey of the China Bay Oil Tank Farm premises situated in a 677-acres state land.
The Secretary said the survey had been completed.
The move to form the new CPC subsidiary company ahead of obtaining cabinet approval comes in the wake of ministers claiming that prior cabinet approval was not obtained regarding the sale 40 percent of the shares in the Yugadanavi Power Plant to the US-based New Fortress Energy company.
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