ECONOMYNEXT – Sri Lanka’s cabinet of ministers has approved a proposal to double the 50,000 barrel per day Iran built refinery in Sapugaskanda with an investor on a Build-Operate-Transfer (BOT) basis, the government said.
The move comes amid delay of establishing a refinery in the Eastern port district of Trincomalee.
“Approval has been granted by the board of directors of the Ceylon
Petroleum Corporation (CPC) to call for expressions of interest to identify a suitable investment partner based on
the feasibility study conducted in the year 2022,” the government said in its weekly cabinet decisions on Tuesday.
“Accordingly, the Cabinet of Ministers has approved the
proposal presented by the Minister of Power and Energy to develop the Sapugaskanda oil refinery and call for expressions of interest for the identification and selection of suitable financial suppliers/investors for the implementation of the project for the establishment of a new refinery within the same premises with a capacity of 100,000 barrels per day on the basis of an operation and transfer (BOT).”
The CPC’s efforts to modernize and upgrade the Sapugaskanda oil refinery both quantitatively and qualitatively to fulfill the demand of the market have not been successful, the government said.
Under the policy framework relevant to the energy of the present government, the modernization of the existing refinery or construction of a new refinery has been identified as a priority function.”
the cabinet had already approved a proposal to establish the
Sapugaskanda oil refinery as a public enterprise separate from the CPC and to identify an appropriate strategic investment partner.
However, it is yet to be implemented.
The cabinet has also granted approval to take necessary steps to see the possibility for establishment of a new oil refinery in the Trincomalee area. The new government last month said they had invited India to establish this refinery. (Colombo/February 11/2025)
