Middle East countries eye Sapugaskanda refinery expansion; CPC seeks strategic partnersh
– Some countries in the Middle East have taken a keen interest in investment in the expansion of the Sapugaskanda refinery, and the Ceylon Petroleum Corporation (CPC), which has now called for Expressions of Interest (EOI), will prioritise investors coming up with a better package with the agreement to supply crude oil and buy back refined products afterwards, an official said.CPC Chairman D.A. Rajakaruna told Daily Mirror that Sri Lanka is seeking long-term, value-adding partnerships to create a competitive advantage in the regional petroleum sector.
The Sapugaskanda refinery has been a critical asset in Sri Lanka’s energy security for decades, and the expansion plans were considered earlier, followed by feasibility studies in 2010 and 2022, but several challenges delayed progress. The ivil war, the pandemic, economic crises, and political instability prevented any investment.
“With stability improving and regional energy demand growing, now is the most suitable time to re-initiate the project and ensure its long-term success,” he said.“CPC and the government can manage incremental modifications and maintain profitability,” he said.This is Sri Lanka’s largest and only petroleum refining business, owned by the government, with a guaranteed local demand and strong potential for expansion into bunkering, jet fuel, lubricants, and chemical markets. The government expects healthy, value-adding proposals that go beyond typical investment models, he said.
The state aims to retain a significant stake, ensuring long-term national benefit while allowing investors to secure competitive advantages. Investors should propose partnership models where the government benefits not just proportionally, but strategically, he said.
