jet fuel import and distribution business to open up amid shortage

• SL’s jet fuel reserves fallen to a bare minimum
• Airlines advised to bring in their own fuel for return flights 
• Airlines including SriLankan fueling their planes in India incurring additional costs 
• As a result air ticket prices have risen over 150%

The Cabinet nod has been granted to open up the jet fuel import and distribution business to bunker license holders with the country’s jet fuel reserves falling to a bare minimum triggering a situation where airlines are advised to bring in their own jet fuel for the return journey. 

Power and Energy Minister Kanchana Wijesekera on Monday sought the approval of the Cabinet of Ministers to allow the importation, supply and sale of Jet A-1 aviation fuel to fuel bunker holders registered with the Sri Lanka Ports Authority (SLPA) in order sustain aviation services. The daily aviation fuel requirement for aircraft arriving in and departing from the country stands at approximately 1.2 million litres. 

However, current jet fuel reserves have fallen to a bare minimum with no jet fuel shipments in sight for at-least for next 7-10 days.

“At the moment, our jet fuel reserves have fallen to a bare minimum and consequently, we have advised airlines to bring in their jet fuel to return to the scheduled destinations from the country. We can only accommodate fuel requirements of ambulance aircraft and other such emergency aircraft with the current reserves,” a top aviation industry official told Mirror Business.

Accordingly, the Civil Aviation Authority (CAA) had issued a notice advising airlines to carry fuel for their return journey from yesterday onwards.

The Department of Government Information noted that the Ceylon Petroleum Corporation(CPC) has failed to provide even the minimum amount of fuel required to maintain the operations of domestic and foreign airlines under the prevailing crisis in the country.

As an alternative, the national carrier SriLankan Airlines and several other airlines have been forced to fuel their aircraft from South Indian airports and other destinations incurring additional costs. 

Over the past three months, air ticket prices have also risen by an average of 150 percent due to depreciation of rupee and fuel crisis.

The aviation official highlighted that in particular airlines which fly narrow-bodied aircraft could face severe difficulties under the current environment, potentially leading to reduced frequencies and cancellations. 

According to industry sources, its likely to take atleast another month for bunker license holders to bring in their first shipment of jet fuel to the Bandaranaike International Airport using CPC infrastructure. 

They noted that current CPC Act requires to be amended to allow another player to import and distribute jet fuel. Further, it will take around 10 days to a jet fuel shipment from Singapore to arrive in the country after finalising the formalities.