News

News

CPC unions press for local third player
Ceylon Petroleum Corporation (CPC) trade unions have reportedly sent a proposal to the Ministry of Power and Energy recommending the formation of a local company to take the place of the controversial third-player in the privatisation of the loss-making pubic enterprise.

The Finance Ministry was pushing for the entry of an Indian state venture Bharat Petroleum (BPC), to enter as the third-player to CPC and the LIOC (Lanka Indian Oil Corporation).

The CPC trade unions are claiming that the proposed new company can raise the funds required from the banks for cash-flow requirements, given the profit margins that are reported to have been flouted by LIOC in the Investment Public Offer (IPO) prospectus for their share issue which is now to be held on the 29th of this month. The Indian owned LIOC made a presentation last Thursday to the Sri Lankan broking community on their IPO on the system of 'book building ', a novelty in Sri Lanka. Investors were asked to make bids, with money up-front at bands from Rs. 22 to Rs. 27 per share. The strike price is to be determined according to the number of strikes and parties that bid below will not be eligible to any shares.

Meanwhile, Power and Energy Minister Susil Premajayantha and CPC Chairman Jaliya Medagama who are now in India are negotiating for an additional loan from India for the purchase of petroleum products. This is on top of the US $ 150 million already granted to Sri Lanka.

Meanwhile a statement released with regard to President Kumaratunga's visit said that the question of promoting Indian Oil products in Sri Lanka and oil exploration around the island's coast were discussed in detail by two of India’s largest conglomerates. The President requested that a team be sent to Sri Lanka between November 15 to 20 to discuss the relevant issues.

Top

Back to News