The Ceylon Petroleum Corporation (CPC) is currently negotiating with petroleum authorities in the United Arab Emirates (UAE) to purchase oil under a direct agreement, an official confirmed.
Sri Lanka imports its entire petroleum requirement—both crude and refined products—through an open tender process. However, the government has now initiated direct purchase talks with the UAE, specifically with the state-owned Abu Dhabi National Oil Company (ADNOC).
“We are negotiating prices at present. If the rates are competitive, we will proceed with direct purchases,” the CPC official told Daily Mirror.
Earlier this year, President Anura Kumara Dissanayake paid a three-day official visit to the UAE at the invitation of UAE President Mohamed bin Zayed Al Nahyan.
In addition, Sri Lanka has signed a tripartite agreement with the UAE and India for the development of Trincomalee as a petroleum hub. As part of this partnership, India and Sri Lanka are planning to construct a multi-product petroleum pipeline.
Sri Lanka has also planned to establish a new oil refinery in Hambantota with an investment of USD 3.7 billion by Sinopec. The Chinese state-owned oil and gas giant signed an agreement with the Sri Lankan government to expedite the construction of a state-of-the-art refinery within the Hambantota International Port (HIP) investment zone.
The agreement includes provisions to resolve outstanding issues related to water access, land allocation, and taxes. Marking the largest single foreign direct investment in Sri Lanka’s history, the project is yet to commence, as discussions continue between the government and Sinopec over modifications to the original tender terms and conditions.
