COLOMBO, Feb 25 (PTI): Lanka IOC, a unit of Indian Oil Corp, posted a 72 million dollar loss for the three months to December 2005.
Unpaid subsidy bills has worsened Lanka IOC's financial health, with net loss for the nine-month to December 2005 now standing at 70 million dollars, the firm said yesterday in a statement to the Colombo Stock Exchange.
LIOC says it is not given up recovering the unpaid bills, due after selling fuel at government-controlled rates. Sri Lanka's privatsation agency, PERC, has contested the claims through a legal opinion.
"The Company is contesting this position," LIOC told shareholders. However, the Sri Lankan government has been repaying LIOC in stages, though repayments to date stands at 12,000 dollars.
LIOC shares Friday closed at Rs 31.25 down from a high of Rs 55.00 reported last May. The bad news, however, has not stopped Lanka IOC from spending five million dollars to set up a lubricant blending plant in Sri Lanka.
The 18,000 metric tonnes plant will come in the north- eastern district of Trincomalee, where LIOC also has an oil storage facility which was used by the British during World War II.
Work is expected to start within the next two months, with a completion date fixed for March next year.
The local lube market, estimated at around 60 million dollars, is dominated by ChevronTexaco whose local operation is called Caltex Lanka Lubricants Ltd.
The balance is split between LIOC, Exxon Mobil/Esso, Valvoline, Shell and British Petroleum/Castrol.