Business

Norochocholai coal-fired power complex seen as facing staggering financial losses

Published

3 weeks ago

2026/01/13

While the Parliamentary debates were purely focused on missing the calorific value benchmark, the excessive Ash content (21% in the samples tested) is also a reason to reject the shipment, as maximum allowed ash percentage in the tender is 16%. This means even if the tests clear the coal on calorific values, the shipments still must be rejected based on ash content as per tender terms. This fly ash and low moisture will create a massive ecological disaster to the communities in Norachcholai - Withanage

Sri Lanka’s first and largest coal-fired power complex at Norochcholai is staring at mounting financial losses running into millions of rupees as low-quality coal imports, rejected shipments and unusable stockpiles disrupt operations and expose deep flaws in coal procurement, power sector and environmental experts warned yesterday.

Energy sector sources told The Island Financial Review the economic damage has already begun, with rejected coal stocks, delayed payments and declining plant efficiency forcing the system to absorb losses from under-performance, additional handling costs and the risk of turning to more expensive backup generation.

Insiders estimate that continued reliance on sub-standard coal could result in tens of millions of rupees in losses per day, once reduced output, higher fuel burn and maintenance costs are factored in.

At the centre of the controversy is a recent coal shipment procured by the Lanka Coal Company (LCC), which has come under intense scrutiny after laboratory tests reportedly showed ash content of around 21%, far exceeding the 16% maximum allowed under tender conditions.

While parliamentary debate has focused narrowly on whether the coal meets the required calorific value, experts stress that excessive ash alone is sufficient grounds for outright rejection, regardless of calorific performance.

The situation worsened after coal stocks at the Norochcholai Coal-Fired Power Complex were recently rejected, leaving shipments in limbo and payments withheld. Power sector officials say this has resulted in logistical losses, demurrage risks and operational uncertainty, while existing low-quality coal stockpiles continue to deteriorate in storage.

“Coal that does not meet specifications is not just unusable — it becomes a financial liability, a senior electrical engineer said.

High-ash coal reduces boiler efficiency, increases fly ash generation and accelerates wear on ash handling systems, electrostatic precipitators and boilers — translating into higher maintenance costs and forced outages. Industry analysts warn that these hidden costs ultimately find their way into CEB losses or consumer tariffs.

Environmental Scientist Hemantha Withanage warned that accepting or burning such coal would push Norochcholai into a new environmental crisis, with serious consequences for communities in Norochcholai, Puttalam and surrounding areas.

“This is not just about calorific value. High ash coal means significantly more fly ash, Withanage told The Island Financial Review. “With low moisture and excessive ash, particulate matter spreads easily, contaminating air, soil and water. This is a massive ecological threat that will directly affect public health.”

He stressed that fly ash contains toxic heavy metals and fine particulates linked to respiratory illness and long-term environmental degradation. “If tender conditions are ignored, the cost will be paid by communities, not the suppliers, Withanage said.

Critics say the crisis exposes serious weaknesses in coal procurement oversight, with questions now being raised about supplier selection, quality verification and accountability. They argue that repeatedly importing low-quality coal — only to reject it or burn it at reduced efficiency — amounts to systemic mismanagement of public funds.

By Ifham Nizam

All News Advertisement

Business

A Historic First: Sri Lanka’s capital market leaders bring investor forum to Saudi Arabia

Published

7 hours ago

2026/02/6

Thilina Walpola

Key dignitaries at the Saudi investor forum

The Securities and Exchange Commission of Sri Lanka (SEC) and the Colombo Stock Exchange (CSE), in association with the Embassy of Sri Lanka to the Kingdom of Saudi Arabia, successfully convened an investor forum on Saturday 24th January 2026 at the Radisson Blu Hotel, Riyadh Convention & Exhibition Center. Alongside the forum, the SEC and CSE facilitated a meeting with the Public Investment Fund (PIF) which is Saudi Arabia’s main sovereign wealth fund.

The forum was organized to engage directly with the vibrant Sri Lankan expatriate community in the Kingdom and international investors, highlighting compelling opportunities within Sri Lanka’s capital market following the country’s successful exit from sovereign default and restoration of macroeconomic stability.

The forum was marked by the presence of several senior level policy officials, market leaders and market regulators including; Dr. P. Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka (CBSL); Chathuranga Abeysinghe, Deputy Minister of Industry and Entrepreneurship Development; Ameer Ajwad Ambassador of Sri Lanka to the Kingdom of Saudi Arabia.; Senior Prof D.B.P.H. Dissabandara, Chairman of the SEC; Ray Abeywardena, Director of CSE; and Dr. Naveen Gunawardane, Co-Founder and Managing Director of Lynear Wealth Management.

In his welcome address, Ameer Ajwad stated, that a significant opportunity remains in broadening public participation in the capital market of Sri Lanka. As financial literacy and investment awareness among potential investors are limited, the investor forum would serve to bridge the knowledge gap. The forum offered an excellent opportunity for first-time investors, overseas investors, and those seeking to enhance their knowledge, to learn how to invest prudently, manage risk, and build wealth with discipline and confidence. Ambassador invited participants to make full use of the presence of high-level authorities from Sri Lanka’s key financial institutions, such as the Central Bank of Sri Lanka, the SEC, and the CSE, and to explore investment opportunities in Sri Lanka’s capital market, not only as a pathway to financial growth but also as a meaningful contribution to Sri Lanka’s resilience and long-term prosperity.

Business

CIC Holdings’ 9MFY26 revenue reaches Rs.70 bn

Published

7 hours ago

2026/02/6

Thilina Walpola

Agriculture-rich diversified conglomerate CIC Holdings PLC (CSE: CIC) recorded a consolidated revenue of Rs. 70.28 billion for the nine months ended 31 December 2025 (9MFY26), reflecting an increase of 8.69% YoY compared to the corresponding period of the previous year.

The Group’s gross profit increased by 10.11% to Rs. 18.42 billion, with the gross profit margin for the period under review improving to approximately 26%, supported by disciplined pricing and product mix optimisation. Profit after tax (PAT) increased to Rs. 5.97 billion from Rs. 5.70 billion in the corresponding period of the previous year, despite losses incurred in parts of the Group’s agri operations following the impact of Cyclone Ditwah, which disrupted cultivation activity during the Maha season.

The Group’s Crop Solutions sector remained the largest contributor to consolidated revenue, accounting for approximately 44.7% of total revenue, followed by Livestock Solutions at 21% and Health & Personal Care at 20.18%. The remaining sectors, Industrial Solutions and Agri Produce, contributed 8.6% and 6.4% to Group turnover respectively. Health and Personal Care , particularly export-driven product lines, recorded improved performance during the period, alongside continued growth in feeds, poultry, and veterinary care solutions, which supported the Group’s overall operating results.

Despite cyclone-related disruption to cultivation cycles, the Group delivered a strong operating performance, with EBITDA and operating profit (EBIT) both recording year-on-year growth. Operating profit (EBIT) closed at Rs. 9.67 billion, compared to Rs. 8.62 billion in the corresponding period of the previous year, reflecting the strength of the Group’s diversified portfolio and disciplined cost management.

During the period in review, key Group businesses across the five industry sectors, namely Crop Solutions, Agri Produce, Livestock Solutions, Industrial Solutions, and Health & Personal Care, continued to perform resiliently. Crop Solutions revenue increased from Rs. 28.06 billion to Rs. 32.32 billion, while Livestock Solutions revenue grew from Rs. 13.35 billion to Rs. 14.60 billion. Health & Personal Care revenue improved from Rs. 14.29 billion to Rs. 14.46 billion, supported by herbal health product exports and steady domestic demand. Revenue from Agri Produce increased from Rs. 4.35 billion to Rs. 4.64 billion, while Industrial Solutions revenue rose from Rs. 6.07 billion to Rs. 6.28 billion.

Commenting on the performance, CIC Holdings Group CEO Aroshan Seresinhe said, “Despite the disruption caused by Cyclone Ditwah to agricultural activity during the Maha season, the Group remained focused on supporting farming communities through well clean-up operations, field renovation, and the restoration of cultivation activity.

Business

CSE regains some of its bullish verve as turnover hits Rs.11 billion

Published

7 hours ago

2026/02/6

Thilina Walpola

CSE trading reflected a bullish trend yesterday due to positive quarterly corporate earnings coupled with lower Treasury Bill yields, market analysts said.

Further, institutional participation contributed more than 50 percent to the day’s turnover.

Amid those developments both indices moved upwards. The All Share Price Index went up by 63.67 points, while the S and P SL20 rose by 12.58 points.

Turnover stood at Rs 11.1 billion with10 crossings. The top seven crossings were: JKH 189.5 million shares crossed to the tune of Rs 4.2 billion; its shares traded at Rs 22.70, HNB 3.5 million shares crossed for Rs 1.48 billion; its shares traded at Rs 422, Hemas Holdings 11 million shares crossed for Rs 376.2 million; its shares traded at Rs 34 20, Commercial Bank 1.5 million shares crossed for Rs 336.8 million; its shares traded at Rs 224.50, Sampath Bank 600,000 shares crossed for Rs 93.6 million; its shares sold at Rs 156, Laugfs Gas 868,000 shares crossed for Rs 51.6 million; its shares sold at Rs 71 and Sierra Cables 1 million shares crossed for Rs 36.7 million; its shares sold at Rs 36.70.

In the retail market top seven companies that mainly contributed to the turnover were; Ceylon Land Equity Rs 385 million (20 million shares traded), Commercial Bank Rs 373.9 million (1.7 million shares traded), Luminex Rs 247.2 million (26.7 million shares traded), Colombo Dockyard Rs 152 million (one million shares traded), TJ Lanka Rs 152 million (four million shares traded), Easter Merchants Rs 142 million (8.7 million shares traded) and RIL Properties Rs 116.9 million. During the day 441.3 million share volumes changed hands in 44406 transactions.

It is said that manufacturing sector counters, especially JKH, led the market while the banking sector also performed well, especially HNB and Sampath Bank. Further, the capital goods sector too performed well.Yesterday the Central Bank’s US dollar buying rate was Rs 305.78 and selling rate Rs 313.32.

By Hiran H Senewiratne