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Sri Lanka to close the Sapugaskanda oil refinery again from January 03

The Sapugaskanda Oil Refinery will be closed from January 03 due to the shortage of US dollars for the purchase of crude oil, the Ministry of Energy said.

The Petroleum Corporation management is preparing to restart the country’s only oil refinery before January 30 after procuring the required crude oil.

The supply of crude oil by the Singaporean company which was awarded the long term contract for the supply of crude oil to Sri Lanka will commence from January 25.

In the process of purchasing crude oil, the relevant company should be informed 90 days in advance of the purchase of the crude oil type used in the Sapugaskanda refinery, the Ministry said in a statement. Also, the purchase of alternative crude oil as emergency purchases failed due to the lack of foreign exchange, it added.

It has also become difficult to buy crude oil on a credit basis as Sri Lanka has fallen in the credit rating, the Ministry further explained.

However, Sapugaskanda oil refinery supplies only 14% of the country’s petrol and 29% of its diesel requirements.

Therefore, the Ministry of Energy assures that the temporary closure of the refinery will not create an oil shortage in the country.

Sri Lanka for the first time shut down the refinery on November 15 due to a shortage in crude oil supply. The refinery resumed operations on 07 December.

Courtesy: Colombo Page

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