Sri Lanka’s Ceylon Petroleum Corp. (CPC) has received approval from the Cabinet to open a state-owned lubricant manufacturing facility in the country.

The proposed company will commence within two weeks, with an initial investment of USD 13 million, Lanka Business Online reported.

There is a proposal to liberalize Sri Lanka’s lubricants market and encourage private companies to invest in this sector.  Chevron Lubricants Lanka CEO Kishu Gomes has expressed concerns about this proposal. “We have concerns about the 2016 budget proposals in respect of the lubricant industry,” he said. He said this could put the 54-million-litre-per-annum market, which currently has 13 players, at risk of being fragmented.

There is also a proposal to remove lubricants from the Board of Investments’ (BOI) negative list.

“The government’s proposal to open up the lubricant market and remove lubricants from the BOI negative list will affect all existing players,” he said.