Energy Ministry to issue refining licenses


Under the revisions that would be made in the Ceylon Petroleum Corporation Act No. 28 of 1961, the Ministry of Energy is expected to be vested with the authority of issuing licenses to refine oil products in Sri Lanka, 

Accordingly, the Cabinet of Ministers earlier this week approved amendments of the Ceylon Petroleum Corporation (CPC) Act which is Act No. 28 of 1961.

Speaking to The Morning Business, Minister of Energy Udaya Gammanpila highlighted that there are only two amendments in the CPC Act that have become the need of the hour, of which one was the aforementioned licensing authority.

Secondly, the Minister said the definition of “petroleum” needs to be changed to meet the present day requirements, “because there are many more petroleum products in the world. However, the Act No. 28 of 1961 does not include all these products, which obviously need to be included”, he added.

On a separate note, Gammanpila stated that the Ministry is set to establish a refinery with the production capacity of 100,000 barrels per day (bpd), and to upgrade the existing refinery capacity to 45,000 bpd from a mere 13,000 bpd, which is the present capacity.

“We are going to finance it on a Build-Operate-Transfer (BOT) basis,” Gammanpila added; however, at the moment, the CPC has the exclusive rights to refine crude oil in Sri Lanka.

“Therefore, in order to accommodate this BOT Basis, we have to amend the CPC Act 28 of 1961,” he explained. 

Moreover, quoting the new CPC definition, he said: “Petroleum resources means crude oil, natural gas, and hydrocarbons, whether in natural liquid, gas, solid, or semi-solid state, hydrates of oil and gas, sulphur, or other substances associated with hydrocarbon that are recovered by petroleum operations.” 

The proposal was furnished by Minister Gammanpila to revise and amend the CPC Act, as certain provisions of the said Act were found insufficient to cater to present-day requirements. Thus, the Legal Draftsman was instructed to draft the Bill on the Cabinet-approved matter.


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