By Susitha Fernando

Colombo, Mar 28 (IANS): Sri Lankan Cabinet has approved to award licenses to China's Sinopec and two other companies from Australia and the United States to enter the Island country's fuel retail market, which is currently run by the state-run Ceylon Petroleum Corporation (CPC) and India's Lanka Indian Oil Corporation (LIOC).

"Cabinet approval granted to award licenses to Sinopec, United Petroleum, Australia and RM Parks of USA in a collaboration with Shell Plc to enter the Fuel Retail market in Sri Lanka," Power and Energy Minister Kanchana Wijesekera said in a tweet on Monday.

The minister further said that the Energy Committee and other relevant procurement committees had given their approval and recommendation to award the three companies the licenses to operate.

The three new companies will be allocated 150 dealer operated fuel stations each, which are currently operated by the CPC. "They will be granted a license to operate for 20 years to import, store, distribute and sell petroleum products in Sri Lanka. A further 50 fuel stations at new locations will be established by each selected company," he said in another tweet.

At present, the CPC with over 1200 fuel stations and Lanka IOC, the Sri Lankan subsidiary of Indian Oil Corporation, with over 250 filling stations run the fuel retailing in the country.

Following the severe fuel crisis due to the dollar crunch since the beginning of 2022, Sri Lanka decided to give half of nearly 1200 state-owned filling stations to foreign companies. Sri Lanka, with no dollars to pay for fuel shipments, forced the consumers to await dates long queues.

Helping its closest southern neighbour to come out of the crisis, India provided over $4 billion financial assistance, which included fuel which were supplied through the LIOC.