If CPC had enough stocks, this situation wouldn’t have occurred : LIOC Managing Director

8 November 2017 12:00 am - 0     - {{hitsCtrl.values.hits}}

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Managing Director Lanka Indian Oil Company (LIOC) Shyam Bhora disproved Petroleum Resource Development Minister Arjuna Ranatunga’s claim that his company had pressurized the Minister and the officials to accept the contaminated fuel shipment. Speaking to the Daily Mirror, Bhora said that although the LIOC had sufficient stock to meet the demands for 25 to 30 days without the contaminated stock that arrived at Colombo on October 15, as a goodwill gesture, he had requested their global suppliers to supply fuel to Sri Lanka in order to assist the Ceylon Petroleum Corporation as their shipments were getting delayed.   

“When we understood that the shipments CPC was expecting on November 2 were getting delayed, we requested our global suppliers to send fuel to avert the crisis. These stocks are expected to arrive in Colombo on November 10. We have assisted the CPC to procure emergency shipments whenever they faced crisis situations. Even when the CPC officers were on strike, the LIOC worked round the clock to supply the petroleum products,” Bhora said   


 

  • We are not here to confront the Minister or any other official 
  • The shipload of petrol that reached Colombo on October 15 was contaminated 
  • Once the shipment is rejected, we do not have any role to play thereafter with the stock until we receive another stock 

The Excerpts

Q Is it true that the shipment of petrol that reached Colombo on October 15 was contaminated? 
Yes, the stock of 35,000MT petrol supplied by the French Oil Company M/s TOTAL that arrived the Colombo Port was contaminated. The appearance did not meet with the Ceylon Petroleum Corporation (CPC) specifications for gasoline 92 Octane. So the stock was rejected, and which is understandable.   

Q Did the LIOC at any point refuse to accept the specification report? 
As per the routine procedure the stock was tested by the CPC and Ceylon Petroleum Storage Terminals Limited (CPSTL) laboratory before being accepted by us. It was found that the shipment contained some visible particles while the fuel stock met the chemical properties specification. Not only the CPC and CPSTL but also the LIOC refused to accept the shipment as we always maintain high quality standards. We never refused to accept the specification report as we have high regard to the procedure that the CPC is carrying out.   

Q At a press briefing held on Monday, Petroleum Resource Development Minister Arjuna Ranatunga blamed the LIOC for the fuel crisis situation the country is now facing and claiming that your failure to supply the stock on time resulted in a fuel shortage... 
What a misleading statement it was! By the time the shipment reached Colombo on October 15, we had enough of stocks for 25 to 30 days. Because of the upcoming festive season we got this shipment down. How can a responsible Minister claim that it was because of us the country faces a fuel shortage? If the CPC had enough of stocks, this situation would have never occurred. It is the CPC that caters to 84% fuel for the local market as they have over 1500 fuel stations comparing to LIOC’s 200 that caters to 16% of the total requirement.   

Q According to the Minister, the rejected ship is still anchored on the sea off Trincomalee with the view of obtaining the CPC approval at any cost. How do you react to it? 
When the laboratory report stated that the fuel was contaminated, we immediately informed M/s TOTAL to replace the shipload. Once the shipload is rejected, we do not have any role to play thereafter with the stock, until we receive another. It is solely at the supplier’s discretion the vessel has been taken out of the Sri Lankan waters or otherwise. If the ship is still anchored at the Trincomalee port, it is up to the authorities concerned to see under whose direction it is still in the Sri Lankan waters. It is incorrect to blame us without any reason.   

Q Is it true that that the supplier, M/s TOTAL offered to remove the particles through filtration and supply the same stock to CPC once again? 
Yes. As a replacement cargo takes 20 to 25 days to reach Colombo, the supplier offered to remove the particles through filtration process, which is a common practice. We then informed the CPC about the request. To which, the officials disagreed. On October 31, when we had a meeting with the Minister, the Ministry Secretary and other officials, we brought to their notice how the supplier was willing to filter the stock and transfer the purified fuel to another vessel (ship to ship transfer) as this is an allowed practice, to which we had the Sri Lanka Customs approval as well.

But when the Minister and the officials did not want to go for another test after following the filtration process, we informed the supplier to take the stock back and to deliver another stock. We are not here to confront with the Minister or any other officials, but to carry out our duties. Allegations that are levelled against the LIOC for pressurizing the politicians or the CPC to accept the contaminated fuel shipment are totally misleading.   

 As a replacement cargo takes 20 to 25 days to reach Colombo, the supplier offered to remove the particles through filtration process, which is a common practice. We then informed the CPC about the request

Q There is also an allegation that the LIOC is forcing the CPC to buy this contaminated stock.What are your comments on this?
Not true at all. I was so surprised by the remarks made by the Minister against the LIOC at the media briefing and also in the headlines in all newspapers in Sri Lanka. This is misleading.   

Q Is it true that LIOC filling stations do not sell diesel although they have sufficient stocks with them? 
It is a total misrepresentation of facts that diesel is not being sold at LIOC filling stations. The LIOC has adequate stocks of diesel at Trincomalee and Colombo, and the normal daily sale volume of 775MT is being continuously distributed from all our 200 filling stations. Unless they (filling stations) have gone dry due to any delay in supply of fuel, we have not, and will not refrain from selling fuel in any of our filling stations.   


Q The Minister alleged that you had a plan to get down a shipload of petrol and diesel of which the stock is supposed to be of inferior quality... 
Through our parent company we were able to find another supplier who was willing to supply petrol and diesel - both in the same vessel. These are larger vessels and for them to supply a small volume of petrol was not viable and they wanted to supply both - diesel and petrol - in the same vessel.

The reason why the Minister claims that they can accept petrol but not diesel, as it is of inferior quality, because the diesel that we use in India is slightly different to what is being used in Sri Lanka. In India, we use Euro 4 diesel while in Sri Lanka, it is Euro 3. As the CPC says that the Indian specification does not tally with Sri Lankan, how can they say that the Indian diesel is of inferior quality?   

Q Have you, at any time, tried to influence the Minister or any other politicians to allow the contaminated stock of petrol to be supplied? 
 I would be very much thankful to the Minister if he could reveal the names of those who have tried to influence him or any other politicians who have been approached to buy this stock. We have been in this business over the years but this is the first time such an allegation has been levelled against us, which is very detrimental to our reputation.   

 

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