Oct 19, Colombo: Trade union sources at Sri Lanka's petroleum authority, Ceylon Petroleum Corporation (CPC) say the petroleum refinery in Sapugaskanda will be closed from October 23.

Union sources say shortage of crude oil stocks for refining is the reason for the suspended operations. The trade unions accuse the CPC authorities for the delay in importing crude oil.

According to the trade union sources the refinery is bringing losses to the CPC due to technical issues. The production has also declined over the past few months and it was deliberately lowered in the past two weeks to run the machines without shutting down.

The CPC authorities say a delay could occur in crude oil importation due to sanctions imposed against Iran but the authority will directly import refined fuel rather than importing crude and refining it to maintain fuel supplies in case of a delay in receiving crude oil.

The Corporation said it has been compelled to reduce the number of ships carrying crude oil to Sri Lanka from Iran, from 13 to 10, due to the US sanctions on Iran.

Trade unions say that the government has held talks with India with plans to sell out this refinery.

Sapugaskanda petroleum refinery caters to 30 percent of the country's petroleum needs.