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Unions claim low-quality oil affecting Sapugaskanda refinery

20 Jun 2022

  • Claims output has decreased significantly
By Buddhika Samaraweera The Petroleum Trade Unions’ Confederation (PTUC) has claimed that the amount of fuel produced at the Sapugaskanda Oil Refinery has dropped significantly due to the low quality of crude oil imported to Sri Lanka, as well as the inability to carry out refining operations at full capacity due to insufficient stocks of crude oil. Speaking to The Morning yesterday (19), PTUC Convener Ananda Palitha said: “The refinery needs about 5,500 metric tonnes (MT) of crude oil to operate at full capacity. However, as there is no definite date for the arrival of a crude oil tanker, the Refinery is currently operating at a capacity of 3,400 MT per day. As a result, the amount of fuel produced at the refinery has been significantly reduced.” He said that the refinery currently produces around 620 MT of kerosene, 325 MT of petrol, 820 MT of diesel, 1,200 MT, and 35-40 MT of gas daily. However, he said that the amount of fuel and gas previously produced at the Sapugaskanda refinery was much higher. If the refinery is operating at maximum capacity at 5,500 MT, he said, it would produce 1,000 MT of kerosene, 600-650 MT of petrol, 1,800-1850 MT of diesel, 2,000 MT of furnace oil, and 70 MT of gas per day. That amount has been greatly reduced by now, he added. Palitha also said that the lack of quality in the crude oil imported recently has also led to the decline in production. For example, he said, in the past, the production of furnace oil, a byproduct in crude oil refining, was only 35%, but now it has increased to 50%. He said that it is a great loss when the production of high-value fuel decreases and low-value fuel, such as furnace oil, increases in this manner. In March, the Sapugaskanda Oil Refinery was closed indefinitely due to the shortage of crude oil, which was caused by the US dollar deficit in the country. The refinery had to suspend its operations on two previous occasions due to the same issue. Against this backdrop, the refinery resumed its operations with a crude oil shipment being unloaded on 27 May. However, the PTUC last week claimed that the Government has no choice but to close the Sapugaskanda Oil Refinery by 28 June, to allow it to operate as a white elephant, or to hand it over to some other party, given that there is no idea as to when a crude oil tanker will arrive in Sri Lanka.


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