The Sunday Leader

CPC Losing Millions

  • CPC has to pay Rs.2.8 million per ship per day

By Nirmala Kannangara

Failure to demand compensation from the Italian company that supplied the ‘undersea buoy hose’ which ruptured while crude oil was being transferred at the Colombo Port on May 23 is to cost the Ceylon Petroleum Corporation (CPC) dearly. Chairman of the Petroleum Common Workers Union Asoka Ranwala said that although there is a three year warranty for the hose it is questionable as to why the CPC management is silent without demanding that the Italian Company – Milano – pays the demurrage and other expenses which the Corporation has to bear because the buoy hose burst in the sea.

“Because of this, the CPC has to pay Rs 2.8 million per ship per day. From the time the hose burst on May 23 to date the CPC has had to pay the demurrage. Because the Corporation had not informed the second and third ships not to bring the ordered crude oil, they arrived at the Colombo harbour on June 14 and 29 respectively. For the three ships we have to pay Rs 8.4 million per day as demurrage,” added Ranwala. Ranwala further said that in addition to the demurrage, the Corporation has to spend millions of rupees to get the buoy hose repaired. “The sea is rough and it has become difficult for the workers to repair the hose in the water and sometimes we have had to get 15 to 30 technicians for the repair job. Since there is no crude oil being delivered, the Sapugaskanda refinery had to stop its operations last week, but it still has to maintain the refinery and pay salaries to 1,300 workers. This has cost the Corporation another Rs 10 to 20 million,” added Ranwala. 

According to him, although the Italian company is now blaming the Sri Lankan government for the rupture of the hose claiming it was due to the shifting of the hose by four meters during the port expansion programme, the CPC management is silent and not holding the Italian company accountable for supplying inferior products. “If they claim that the Colombo port hose burst because it was moved by four meters during the port expansion programme, then why did the Muthurajawela hose rupture last month when it had not been shifted even an inch.

This company has supplied inferior products and that is why both hoses ruptured within the space of a few weeks. We are surprised as to why the management is silent without taking up the issue and demanding that the Italian company bears the entire expense which we have had to pay so far,” said Ranwala. The Minister for Petroleum Industries Anura Priyadharshana Yapa could not be reached for a comment and the Managing Director of CPC Susantha Silva also could not be contacted. Deputy Minister Petroleum Industries Sarana Gunawardena, when contacted, said he was not aware of the details regarding the issue.


9 Comments for “CPC Losing Millions”

  1. Manuelpillai

    The people have the right to know who is at the bottom of this trouble. Why should the people pay through their nose?

  2. Ma Per

    Very probably the Italian company’s allegation is true. If so, who is responsible and accountable for this. In its bid to create more and more extravagant ventures which are not useful to the majority of ordinary citizens, they go and damage important equipment like the hose. If the Italian company is at fault, then why is the government silent?

  3. why Sunday Leader making inquiries with Sarana Gunawardena, this guy will only know of Kappan and kommis in his area.

  4. CPC all the time made massive losses. This is not the first time CPC made losses. There is no point in blaming the Italian company for the supply of horse pipes. I am sure somebody in the CPC made mega money to buy sub-standard hose pipes from Italy. Corruption is today ruining our country. Those who hold top jobs are enjoying life at the expense of all of us. We continue to support this. When are we going to learn.

  5. Lanka Puth

    Its another corrupted act of MR Henchmen where MR is keeping silent as a pussy cat. Anyhow, they got the licence to kill and to corrupt by being a part of the most devastated government in the SL history.

  6. ed

    This is Sri Lankan style Corruption

  7. Omar Mohammed

    When we have incompetent people holding key positions, we can expect this and even more. It is ultimately the public that has to suffer in silence.

    The government would increase the price even without informing the public like they have done to the electricity bill.

  8. GMPHOM 5th Edition

    The next thing that is likely to burst is the floating hose string at Muthurajawela buoy, which CPSTL has purchased according to an outdated standard – GMPHOM 4th Edition, in spite of one manufacturer highlighting this error in their tender specification and refraining from bidding. The new edition of this standard (5th edition) has much more stringent requirements, with respect to type testing.

  9. gamarala

    Somebody made a fast buck purchasing the wrong hose.

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