Jun 09, 2018

Oil pipelines blocked, CPC losses billions!

Due to four of the five oil pipelines that pump crude oil from the ships to the Kolonnawa refinery being out of service, the CPC is losing millions from each shipment of oil, ‘Silumina’ reported.

It is reported that if the only pipeline that is functional is affected in any manner, the country could face a serious fuel supply crisis.

Currently, oil is being pumped through the only operational 9” pipeline from the port to the Kolonnawa refinery and since only one pipeline is operational, it takes a minimum of around 8 days to complete a single shipment.

It is reported that due to the ship being docked at the harbour for such a long period, CPC has to pay demurrage fees of around Rs. 4 million per ship per day.

It is also reported that as only one pipeline is operational for the pumping of Diesel, Petrol and Aviation fuel, after each pumping operation the pipeline has to be rinsed with sea water before the next type of fuel is pumped, which leads to the corrosion of the pipeline.

Although the CPC had taken measures to repair the 12” pipeline recently, this process was stalled halfway.

In addition, as crude oil, petrol and Kerosene oil is being pumped through the two pipelines at Muthurajawela, these pipelines too have to be rinsed using sea water. It is said that this situation too would lead to a huge fuel crisis before long. Currently, the CPC only holds fuel buffer stocks for just 15 days and if a fuel shipment is delayed, as experienced previously, the country would inevitably face a serious fuel crisis.

However, ‘Silumina’ reported that several attempts made to contact the CPC Chairman Dammika Ranatunge regarding this issue, had proved futile.