Opportunity Sri Lanka | » Sri Lanka’s Petroleum Corporation to build new storage facility in Hambantota Port
Sri Lanka’s Petroleum Corporation to build new storage facility in Hambantota Port

Sri Lanka’s Petroleum Corporation to build new storage facility in Hambantota Port

The Ceylon Petroleum Corporation (CPC) of Sri Lanka has reportedly signed a Memorandum of Understanding (MoU) with the Hambantota International Port Group (HIPG) recently to develop Hambantota Port as a strategic energy centre in the country.
The signing ceremony was held at Sri Lanka’s Ministry of Energy, with top officials of CPC and HIPG in attendance.
According to reports, a separate storage terminal with associated facilities for both domestic and export purposes connected to the port via a pipeline is to be established by CPC, about 15 km away from the port.
The state owned energy utility, the CPC, provides the majority of petroleum products to local consumers. The CPC has reportedly identified a land area of approximately 50 acres owned by the Sri Lanka Mahaweli Authority for the project and the new facility is expected to expand storage and bulk distribution facilities of CPC.
The existing storage facility of CPC/ Ceylon Petroleum Storage Terminals Limited (CPSTL) is sufficient to store refined petroleum product requirements of the entire country for a period of only one month, which is a capacity below the requirements of ensuring the energy security of the country.
CPC currently imports refined petroleum products to cater to, approximately, 70% of the country’s demand via the Colombo Port and suburbs and the Corporation has identified the need to increase its fuel storage capacity to cater to at least three months of the country’s demand, according to local media reports.
“The growing demand for fuel in the past, combined with the country’s anticipated development in every aspect, has resulted in the opening up of opportunities for investors to establish ventures in Sri Lanka. In this context, CPC’s product portfolio has to be managed to suit the energy mix of the country if we are to be competitive, especially in comparison with other energy sources,” CPC Chairman Sumith Wijesinghe has been quoted as saying.
He has further noted that the partnership with HIPG would increase the storage facility of CPC to the expected capacity; thereby the impact of global fuel price fluctuations can be mitigated and it will drive CPC to minimise and save additional foreign currency outflows.
Also, the setting up of the new facility in the Hambantota Industrial Zone, away from the traffic congestion of the country’s most residential cities, is expected to make it an environmentally-friendly terminal.
“Taking all these factors into account, I believe this partnership will put an end to the negative external factors of the country’s fuel market,” Wijesinghe has added.

OSL take:

Sri Lanka’s power and energy sectors are fast expanding resulting in the increase of business/investment opportunities in these sectors. With Sri Lanka poising itself as a business hub in the South Asian region, the country’s demand for power and energy has recorded an increase in demand. This demand has in turn expanded the business/investment opportunities in the country’s power and energy sectors. Foreign businesses/investors could explore the opportunities in upgrading existing systems as well as required infrastructure facilities.

Share this:

Article Code : VBS/AT/20210618/Z_2

    For More Info and Help

    Leave a Comment