Trinco Bunkering now given to IOC – FSP

Trinco oil tank farm

By Rathindra Kuruwita

Energy Minister Udaya Gammanpila yesterday said that discussions with India on regaining the control of the Trincomalee oil tank farm had concluded successfully and that 14 oil tanks in the Trincomalee oil tank farm would be leased to the LIOC for another 50 years. Gammanpila added that LIOC had been controlling the tank farm since 2003.

Twenty four oil tanks would be given to CPC and the remaining 61 managed by Trinco Petroleum Terminals Ltd., a joint venture between LIOC and CPC, Gammanpila said.

“We have regained control of the Trinco oil tank farm. This is a historic victory. Trinco Petroleum Terminals Ltd. will be run by us. COPE and Parliament has control over it,” he said.

However, the Education Secretary of the Frontline Socialist Party (FSP), Pubudu Jayagoda said that the government had agreed to sell the bunkering operations at Trincomalee to IOC. The government was to sign two agreements with India, he said.

“One is the agreement to hand over to India 14 oil tanks that the IOC is using, the pipelines used to carry fuel and the bunkering operation. IOC will get these infrastructure for 50 years, and the government will lose a lot of foreign revenue as it loses the bunkering operation,” he said.

According to Jayagoda, the second agreement will be on the establishment of Trinco Petroleum Terminals Ltd., a joint venture between LIOC and CPC. Commenting on Minister Gammanpila’s claim that most of the Directors of the Company would be appointed by CPC and that 51% of shares would be owned by the CPC, Jayagoda said that the agreement was similar to the one signed with New Fortress Energy.

“We only sold 40% of the Kerawalapitiya Power Plant shares to New Fortress Energy, but they still control the entire operational aspect of the power plant. Likewise, although IOC only owns 49% of Trinco Petroleum Terminals, they are in charge of the operations. We have given them the best tanks, situated at the lower levels of the tank farm, and the pipelines that transports oil. So they are in control of the tank farm,” he said.

The FSP Education Secretary also asked whether Minister Gammanpila would reveal the specifics of the 24 tanks that have been earmarked for CPC. There were about 20 tanks that couldn’t be used and it was likely that those tanks will be given back to the CPC, he said.

“Minister Gammanpila says that these agreements are a great victory because the Sri Lankan flag will be displayed in the tank farm. This is akin to selling your house because you have no money, and claim that the new owners have agreed to display the portrait of your grandmother in the living room. We have agreed to sign a disastrous agreement with India because of our forex crisis and soon they will have a land at a strategic location in the country,” he said.

Jayagoda also alleged that the Minister had also made a number of false statements about the previous agreements on the tank farm. Despite the Minister’s claims, there was no formal agreement to hand over 14 tanks to India in 2003, he said. An MoU was signed and but a formal agreement was never executed.

“So, IOC was holding these tanks illegally. However, when this agreement is signed it will formally have these tanks. The Minister also claims that the 1987 Indo-Sri Lanka accord earmarked these tanks for Indian use. However, the agreement only states that if we develop these tanks with a foreign partner that partner will have to be India. So Gammanpila is bending facts,” he said.