Vitol fumes over continuity in alleged discrimination by CPC

Tuesday, 21 August 2012 02:06 -     - {{hitsCtrl.values.hits}}

One of the world’s biggest oil traders Vitol is alleging continued discrimination by Ceylon Petroleum Corporation (CPC) after it was shut out from a fresh tender whilst state giant has also been warned of legal action over a breach of contract.

After being snubbed at last week’s tender as exclusively reported by the Daily FT, Vitol was allegedly shut out and not invited to offer with quotes for re-tendering yesterday.

Being a registered supplier of CPC Vitol has argued that there was absolutely no grounds or basis for continued discrimination by the CPC. What has irked Vitol is that CPC is continuing with its dealing with ENOC which previously got embroiled in the supply of questionable cargo.

CPC’s treatment to Vitol is despite no formal intimation with due proof that its diesel supplies being contaminated.

At yesterday’s tender for Gas Oil Mogas 90 INT, Vitol’s quote was nearly $ 900,000 cheaper as opposed to submissions by ENOC and Reliance but the bid wasn’t considered.

“Vitol is not formally blacklisted or suspended but the irony is that it is also not permitted to participate in the tenders,” petroleum industry analysts said.

Daily FT learns that Vitol has fired a letter expressing its serious concern over continued discrimination by CPC.  Analysts claimed that by opting to other quotes CPC was adding cost to the Government coffers.

The snubbing of Vitol in tender is midst CPC not opening LC for a tender previously awarded. This failure despite several requests made has prompted Vitol to warn CPC of legal action over breach of the contract agreed causing losses.

Other industry analysts said CPC’s stance appears to be that until investigations are completed fresh supplies from Vitol will not be considered.

In a public notice on the diesel supply carried via Gulf Muttrah, Vitol claimed that its specialist Dr. Bennett has been in the country for carry out tests on alleged contamination. Vitol maintained that the resolution by scientific and transparent investigation of the Gulf Muttrah allegations remains its primary concern. Vitol views the delay in CPC’s response as adequate to prove the allegations made against Vitol are baseless.

Following the notice, Minister of Petroleum Industries Susil Premajayantha has via a press conference denied Vitol’s position and had wanted it to retract some of the statements.

Vitol is also disputing the selection of samples sent for testing by CPC saying that they are not representative of the cargo it supplied. Vitol has also alleged its cargo was discharged into shore tank that had supplies from others.