Sri Lanka to finalise multi-billion-dollar oil refinery deal with China’s Sinopec in October

Kanchana Wijesekera
Pic by Pradeep Pathirana

• Power and Energy Minister Kanchana Wijesekera anticipates noteworthy investments during President Wickremesinghe’s visit to China in October

By Nishel Fernando
Sri Lanka expects to finalise the proposed multi-billion-dollar oil refinery project in Hambantota with China’s Sinopec Corp. in October during President Ranil Wickremesinghe’s visit to China, which is set to become the largest foreign direct investment (FDI) into the country to-date.
“I believe the largest foreign direct investment to be made in Sri Lanka will also be with Sinopec entering into the refinery operations. It is set to take place in October, hopefully when the President visits the People’s Republic of China,” Minister of Power and Energy, Kanchana Wijesekera revealed.

“We are currently going through the evaluation process of the shortlisted companies, and we hope that not only Sinopec’s retail operations but also the refinery operations will strengthen energy cooperation between the two countries,” he added.
He made these remarks addressing Sinopec’s retail distributor felicitation event held in Colombo on Monday.
The government has shortlisted Sinopec and Vitol as potential investors for the proposed export-oriented refinery in Hambantota. The proposed refinery is expected to cost around US$ 4 billion, according to officials.

Meanwhile, Sinopec Energy Lanka Ltd, a subsidiary of Sinopec Corp, has already signed agreements with 145 fuel stations after securing a 20-year license to franchise 150 existing filling stations throughout Sri Lanka and invest in additional 50 filling stations with an investment of US$ 100 million. Wijesekera noted that Sinopec wouldn’t be restricted to 200 fuel stations and would be allowed to expand into other areas and services based on the demand in the future.

 “We have given you the opportunity to start 50 brand new fuel stations in locations where you see the requirements are arising. It is not necessarily restricted to 200. Some may think that only 200 retail outlets are going to be operated by Sinopec for the next 20 years. When there are requirements, of course, we will open up the door. When requests come from Sinopec to open more dealerships with convenient stores, electric charging, and other facilities, we should make sure to give the approvals for you to continue the business in Sri Lanka,” he said. Sinopec Energy Lanka Ltd General Manager Weng Haini outlined that Sinopec has commenced the systematic transformation of franchise petrol stations with updated signage and a modernised service concept.

According to her, the company would embark on a site transformation project as agreed with dealers, upgrading facilities and equipment to improve the ambiance of Sri Lankan filling stations step-by-step, ensuring their safe and seamless operation.Simultaneously, Sinopec also plans to innovate its service concepts, introduce trilingual customer service, improve the service quality of filing stations, and optimise the service experience of consumers.Wijesekera emphasised that Sinopec’s entrance into Sri Lanka’s energy market would mark a key milestone toward the country’s ambition for energy independence.