The Contract Agreement has been signed, a short while ago, at the Presidential Secretariat with Sinopec Fuel Oil Lanka (Pvt) Ltd and its parent company in China and Singapore for a long-term contract on the import, storage, distribution, and sale of petroleum products in Sri Lanka, the President’s Media Division (PMD) reported.

In March, the Cabinet of Ministers had granted approval to award licenses to China’s Sinopec, Australia’s United Petroleum and RM Parks of the USA, in collaboration with multinational oil and gas company - Shell plc, to enter the fuel retail market in Sri Lanka.

Thereby, they are be granted a license to operate for 20 years to import, store, distribute and sell petroleum products in Sri Lanka.

In June 2022, the Cabinet of Ministers had green-lighted the proposal to open up Sri Lanka’s fuel import and retail sales market to companies from oil-producing nations.

In October the same year, the Petroleum Products (Special Provisions) Bill, paving the way for new suppliers to enter as importers, distributors and retail operators for petroleum products, was approved by the Ministerial Consultative Committee on Power and Energy. 

Later on April 26, a team of officials from Sinopec visited Sri Lanka in order to finalise the agreements and commencement of operations for retail fuel sales, and accordingly, the timeline, conditions of the relevant agreement and other concerns were discussed between the team of officials and technical experts from the Chines energy giant and the Minister of Power and Energy, Kanchana Wijesekera.

It had been decided that the agreements would be signed in mid-May, and that operation would commence 45 days thereon.

Also, the US-based oil company RM Parks Inc. and the British multinational oil and gas company Shell PLC had held discussions with Minister Wijesekera on commencing retail fuel sales in Sri Lanka in the first week of June this year.

Wijesekera, joining the political talk show “360°” on TV Derana earlier in April, revealed that each company will handle 150 CPC dealer-operated filling stations in the local market.

At present, a total of 1,142 filling stations are under the purview of the CPC, however, the corporation fully owns only 234 of them, the minister explained, adding that 450 out of the remaining 908 filling stations owned by private distributors would be allocated to the three foreign oil companies.