Competition from government-owned Ceylon Petroleum Corp. has the potential of lowering the market prices of finished lubricants by as much as 25%, according to Sri Lanka’s Minister of Petroleum Resources Development Chandima Weerakkody.
The government is on embarking on investing in a lubricant blending plant with Ceylon Petroleum Corp. to the tune of USD 13 million.
Addressing a news conference in the capital city of Colombo, Weerakkody said that lubricants is a lucrative business venture, with lubricants being imported and sold at for many years by private companies at higher prices, without the engagement of the petroleum authority.
The Public Utility Commission of Sri Lanka (PUCSL) acts as the shadow regulator for the lubricants market and advises the Ministry of Petroleum on policy and regulatory issues. Importing, exporting, blending, sale, supply and distribution of lubricants and greases require government approval. Approval is granted only to qualified parties who possess proper technical know-how and adequate financial capability, to ensure that sub-standard products do not enter the market.