Sri Lanka is to double the license fee for lubricant sellers and invite more players into the market, Energy Minister M. H. M. Fowzie said Monday.
The license fee will now be fixed at 10 million rupees (100,000 dollars) for a five-year period and two million rupees (20,000 dollars) for one year, Fowzie said. "We want to encourage more players to come into the market and also get (the state-run) Ceylon Petroleum Corporation to compete," the minister said. The local lubricant market, estimated at about six billion rupees (60 million dollars), is dominated by ChevronTexaco whose local operation is called Caltex Lanka Lubricants Ltd.
The balance is split between Lanka Indian Oil Corporation (LIOC), Exxon Mobil/Esso, Valvoline, Shell, and British Petroleum/Castrol.
Caltex controls around 80 percent after having bought a part of the then state-owned lubricant sales operation with a 10-year monopoly in mid-1994.
Caltex's monopoly on the lubricant market ended in July 2004 allowing other players to enter the fray. The new licence conditions, however, will not affect Caltex and LIOC, who entered the market on different terms, officials said.
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