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Pricey Fuel

March 11, 2008 (LBO) – Sri Lanka's state-owned petroleum utility plans to tie up with global ship supplier GAC Ships to sell bunkers or ship fuel in Colombo port, its chairman Ashantha de Mel said. . The Ceylon Petroleum Corporation's plans to re-enter the bunker market will likely bring down prices in Colombo.

"We're in the process of trying to finalise our bunkering venture," de Mel said. "We called for expressions of interest and we found the best was one that GAC Ships gave. We plan to go ahead with them."

De Mel said the CPC will provide the fuel oil from its refinery in Sapugaskanda, north of Colombo, while GAC will supply the barges and do the marketing.

Furnace oil derived from refining crude at the 50,000 barrels per day refinery will be used to provide bunkers and if this supply is not enough the CPC will import bunkers.

"It depends on the time of year," de Mel said. "During certain times of the year we have a little bit of excess fuel.

"When there is rain and CEB (Ceylon Electricity Board state-owned power utility) uses less furnace oil and then we have a little surplus and we can give it as bunker fuel. When it is mostly dry the CEB uses more of the furnace oil

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