The Ministry of Petroleum Resources Development has called for Requests for Qualification (RFQ) to issue new licences to import, export, supply, blend and distribute lubricants with certain barriers under the third round of lubricant industry liberalisation.
The interested parties, either local or international who intend to blend or produce lubricants and grease in Sri Lanka are required to possess at least 5-years of experience in the lubricant business while showcasing the ability to invest a minimum of US$5 million, according to the RFQ published on the Ministry of Petroleum Resources Development webpage.
In order to apply for license to import, export, supply, distribute lubricants and greases, the firms are required to show their ability to invest a minimum of US$1 million.
The Ministry of Petroleum Resources Development noted that there is a greater potential for such exports, especially in view of bi/multi-lateral concessionary trade agreements between Sri Lanka and other countries.
Petroleum Resources Development Ministry Secretary Upali Marasinghe earlier told Mirror Business that the number of new licences to be issued would depend on the soundness of the proposals.
During the year 2017, lubricants (automotive, marine and industrial) sales amounted to 64,485 Kilo Litres at a value of Rs. 26.5 billion.
The automotive, industrial, marine and other (including greases) lubricant sales accounted for approximately 72.58 percent, 16.48 percent, 6.45 percent and 4.49 percent of the market amounting to Rs. 19.7 billion, Rs. 3.6 billion, Rs. 1.5 billion and Rs. 1.78 billion respectively. During this period, approximately 45,367 Kilo Litres were blended locally, while approximately 24,740 Kilo Litres were imported as finished products. In addition, during the same period, 4,568 Kilo Litres of Lubricants were exported to regional markets.
Sri Lanka has 13 market players and 22 authorized lubricant brands, while around 70 percent of the lubricant market is served by 10 licence holders.