Crude oil scam: CPC loses USD 90m in six months

The Ceylon Petroleum Corporation (CPC) lost more than USD 90 million from March to September this year due to the purchase of unsuitable stocks of crude oil and an incorrect pricing methodology, according to an analysis submitted to the government.
The analysis has found that two refined shipments of oil could be bought for the overall amount that has been lost.

The analysis deals with the purchase of crude and refined products for the CPC over the past six months. It recommends that one company be blacklisted permanently for creating losses to the CPC and the Sri Lankan government during the present economic crisis. The unofficial agent of the company has also been invited for confidential CPC meetings while  no other supplier has been invited, it further claims.

While shipments from other suppliers had been outside the port waiting to discharge their cargo, this particular company’s ships had arrived after the others were paid in full and allowed to discharge their cargo and leave, according to the analysis.

The company had also been granted exclusive rights to supply Jet A1 fuel to Sri Lanka while no other supplier had been allowed to quote or bring Jet A1. This situation, though, has now changed after the CPC got its way to include a second supplier to supply Jet A1 fuel.

Meanwhile, Power and Energy Minister Kanchana Wijesekara announced on Friday (7) that the Sapugaskanda Oil Refinery would be closed from Friday due to a shortage of foreign exchange to buy crude oil. “However, there will be no shortage of refined products as the CPC has adequate stocks of all products and CBSL (Central Bank) has made weekly forex requirements for refined products,” he said.

The minister added that a shortage of foreign exchange for the payment of two Ural crude cargos already used at the refinery had led to the decision to close the refinery. As soon as adequate foreign exchange was available to the CPC, the 100,000 Metric Tonne ESPO crude oil cargo shipment in Sri Lankan waters for the past 10 days would be unloaded, he said on Twitter.