Ceylon Petroleum Corporation’s (CPC) decision to import 720,000 tonnes of gas oil from UAE-based firm, Al Ain International Petroleum Derivatives Trader LLC is yet to materialise as tender procedures have not been completed, CPC officials said.They noted that performance bids have not been opened so far and there were some issues to be rectified. When contacted by the Business Times, Secretary of the Ministry of Petroleum Industries Titus Jayawardane said that he was not in a position to divulge details about the deal, but there were some matters to be sorted out.
A petroleum industry expert who wished to be anonymous said that the UAE-based firm’s offer of 5.1 % discount or US$ 4 per barrel whichever higher interest free credit for 360 days was highly impractical. All the other 14 bidders have offered premiums, he said. The company has no experience in handling gas oil and it is only dealing with lubricants, he revealed. On the other hand it has also failed to fulfill the requirement of furnishing a bid security guarantee for $1million bank guarantee from a commercial bank in Sri Lanka.
The UAE-based firm is believed to have submitted a guarantee from a Middle East bank which is against tender procedures. The Business Times reliably understands that the tender was awarded to this company with the intervention of CPC Chairman Harry Jayawardane ignoring senior officials including the Ministry Secretary who is the chief accounting officer of the corporation.
The cargoes of 0.25 percent sulphur gas oil, for delivery beginning in September and continuing to August next year were offered at $4 a barrel below Singapore quotes, local petroleum traders said. A Russian producer would possibly supply Al Ain if the deal goes through, they added. The UAE company gets its products from Russia, Egypt and Iran as they are cheaper than in parts of the Middle East, they added. |
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