LIOC to resume full operations with arrival of second shipment

by Lalin Fernandopulle

Lanka Indian Oil Company (LIOC) will resume full operations with the arrival of the second shipment of fuel from the Indian Oil Corporation in the first week of August, LIOC Managing Director K. Ramakrishnan said.

LIOC, a subsidiary of the Indian Oil Corporation stopped operations due to lack of money coming from the government. The company could not get the government subsidy of Rs. 7.8 billion since January 2004.

Ramakrishnan said the LIOC had to face a financial crisis since the company thought the government would release the money. We fell into difficulty since we did not sign an agreement with the government.

"We will be signing an agreement with the government by the end of July. The government had negotiated to pay a lesser amount to the LIOC, he said.

Ramakrishnan said the import shipment of 6,500 MT of petrol and 11,500 MT of diesel had left the Indian Oil Corporation on Monday night and would reach Sri Lanka by the end of the week. The first shipment will be despatched to Trincomalee and it would be sufficient for 30 days.

The second shipment of 15,000 MT of petrol and 10,000 MT of diesel will arrive in the country by the first week of August. This will be for Colombo and will be sufficient for 45 days, he said.

There was speculation that we will be stopping operations. LIOC will not stop operations in the country and will continue to serve in the best interests of the people. Arrangements are in the pipeline to import more fuel and make it available throughout the country by increasing the number of petrol outlets, Ramakrishnan said.

LIOC runs 158 petrol outlets in the country and we will increase the number with the growing need for fuel stations.

We have received a good response from the public and if the government supports us we will provide more services to the people.

As we have reached a settlement with the government we will resume full operations within 30 days. With the arrival of imported shipments for Colombo early next month we will resume normal operations, Ramakrishnan said.

Petroleum and Petroleum Resource Development Minister A.H.M. Fowzie said the LIOC will have to commence operations and sell fuel at any price within 30 days.

The Minister has given the LIOC an ultimatum and if they don't resume operations he would take over all fuel stations within the 30-day deadline.

The country needs efficient and effective service providers. We cannot afford to dance to the tune of each and everyone, Fowzie said.

Conditions placed by an oil supplying company will not affect the country's fuel requirements or prices. It was the fear created in the minds of people that with the closure of the Lanka Indian Oil Company (LIOC) there would be a shortage of fuel in the country leading to a price hike, Minister Fowzie said.