MOSCOW (MRC) -- Sri Lanka has temporarily shut its only oil refinery as part of efforts to manage dwindling foreign exchange reserves, the energy minister said on Tuesday, triggering long queues at petrol stations, reported Reuters.
The 51-year-old Sapugaskanda Oil Refinery, which has a capacity of 50,000 bpd, was closed on Monday, the minister, Udaya Gammanpila, said at the weekly Cabinet briefing.
"The refinery will be closed for about 50 days. Sri Lanka has very limited foreign exchange reserves at the moment and we need it more for essentials like food and medicine," he said.
Gammanpila said fuel imports would resume once the government was able to raise sufficient dollars but did not give details of a timeline.
Faced with rising inflation and dwindling reserves, the government is discussing a bailout for its economy, cabinet spokesman and Media Minister Dullas Allahaperuma told reporters.
Sri Lanka is also attempting to negotiate a USD500 MM credit line with India to buy fuel and boost reserves, which dropped to USD2.27 B at the end of October. During the first nine mos of 2021, Sri Lanka spent USD692 MM on fuel imports, its highest import expenditure.
As MRC informed before, Indian refiners' crude oil throughput in September edged higher from the previous month, government data showed, as refineries boosted output to meet surging demand. Refiners processed 4.45 MM barrels per day (bpd) (18.21 MM tons) of crude oil last month, up from the 4.36 MMbpd in August, which was the lowest in 10 mos.
We remind that the Indian company Nayara Energy, 49.13% of which is owned by Russia's largest state oil company - Rosneft, has launched a USD750 million petrochemical development program. Nayara Energy has the second largest refinery in India with a capacity of 20 million tons per year. The Indian company has already launched a refinery development program: within the first stage, it is planned to build units for the production of polypropylene (PP) with a capacity of up to 450,000 tonnes per year.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.
MRC