With the expansion and modernization of the Sapugaskanda oil refinery, the Ceylon Petroleum Corporation would be able to meet the entire domestic demand for LP Gas in the country, industry sources told the Daily News.

The expansion would cost the Government Rs15 billion. The current LP Gas consumption in the country is 130,000 mt.

It is expected to rise up to 150,000 by 2015. With the completion of the upgrading and expansion of the Sapugaskanda oil refinery it would be able to increase production up to 150,000 mt, thus meeting the entire local demand. Meanwhile, Shell Gas Lanka Ltd. and Shell Lanka Terminal Ltd., have offered to sell both enterprises to the Government. While the Government owns 49 percent of the shares of Shell Gas Lanka Ltd., the other company Shell Lanka Terminal Ltd., is fully owned by the Shell Group.

It is learnt they have offered the Government a package deal which quoted a huge amount which is several times higher than the price at which Shell Group bought the Colombo Gas Company in 1995 and ran a virtual monopoly till a Second player entered the local LP Gas market.

In December 1995 the Shell Group acquired the assets, liabilities and existing infrastructure of the Colombo Gas Company for a meagre US $ 30 million.