Decision to restructure state-run power sector welcomed

COLOMBO: Sri Lanka’s Ceylon Chambers of Commerce (CCC) welcomed the decision to restructure the state-run power sector of the country, allowing more players to enter the market and called to take important steps under the International Monetary Fund (IMF) program to ensure the country’s sustainable revival.

“The Chamber appreciates the steps taken by policymakers in the Power and Energy sector, and it is encouraging to note that competition is being introduced to the petroleum sector, which was previously dominated by the State,” the CCC said in a statement.

The Sri Lankan cabinet has approved the leasing of 150 fuel stations to three oil companies from China, the US, and Australia in collaboration with Shell.

“Cabinet approval was granted to award licenses to Sinopec, United Petroleum Australia & RM Parks of USA in collaboration with Shell Plc to enter the Fuel Retail market in Sri Lanka,” the Minister of Energy, Kanchana Wijesekera, said in a Twitter message.

“They will be granted a license to operate for 20 years to import, store, distribute, and sell petroleum products in Sri Lanka. A further 50 fuel stations at new locations will be established by each selected company.”The CCC said that allowing three additional players to enter the retail distribution business will increase competition, improve the quality of service, and enable outlets to be set up in remote areas of the country.“

New players being able to import and supply fuel to the country will also reduce the over-reliance on the CPC to procure dollars and distribute fuel, thereby reducing the vulnerabilities faced in 2022 due to a shortage of dollars in the banking system.