Oct 27, Colombo: Petroleum Industries Minister of Sri Lanka, Susil Premajayantha assured today that there will be no shortage of fuel in the country due to the closure of the refinery as the government has taken measures to import oil from other sources.
Minister Premajayantha said letters of credit had been issued to import 215,000 metric tons of crude for the month of November and two ships with crude will be arriving in Colombo port next month.
He added that measures have been taken to import further shipments of crude from Oman and Saudi Arabia.
According to Sri Lanka's petroleum authority, Ceylon Petroleum Corporation (CPC), a ship carrying 80,000 tonnes of Omar Light crude oil is due to arrive on November 10th.
Following the receipt of the shipment, the Sapugaskanda refinery which halted operations since yesterday due to unavailability of Iranian crude oil will restart operations, probably from mid-November.
Another vessel carrying 130,000 tonnes of Arabian Light crude oil will arrive by December, the CPC said.
The petroleum authority switched off the country's only oil refinery in Sapugaskanda due to shortage of supplies of Iranian crude oil which has been affected by the U.S. imposed sanctions on Iran.
The refinery which refines 50,000 barrels of oil per day can only process Iranian crude. The shortage of Iranian crude oil has forced Sri Lanka to import refined fuel from other sources.
Importing refined fuel is costing the country an additional US$ 1.2 billion, according to the cabinet spokesman, Media Minister Keheliya Rambukwella. However, the CPC said it is not expecting a fuel price hike.
Meanwhile, according to a report in The Island newspaper today, Iran has given Sri Lanka the opportunity to purchase its crude oil requirements, without opening Letters of Credit (LC) to overcome U.S. sanctions.
Iranian Ambassador to Sri Lanka, Mohammed Nabi Hassanipour, has told The Island yesterday that according to an agreement reached between the two countries recently the CPC could write to the Iranian Embassy in Colombo setting out its purchase requirement and it would be forwarded to the authorities in Teheran avoiding the need to open LCs.
The government earlier said it will discuss with the United Nations, the US and the European Union the petroleum crisis the island is facing due to the sanctions imposed on Iran by the United States and seek a reprieve as Sri Lanka is incurring an additional cost of US$ 1.2 billion for importing refined fuel.