CPC to buy Naphtha for power generation

Colombo: The Ceylon Petroleum Corp (Ceypetco) is seeking by tender 10,000 tonnes of naphtha for use in power generation for the first time, in a bid to diversify its utility fuels.

Sri Lanka is set to switch to naphtha from expensive gas oil in some generators which are already testing out the new power fuel, one source said.

The country now has one power plant that can run on naphtha, and it takes in 650 tonnes daily, another company source said.

“This is the first time we buy naphtha. We want to see how the price goes,” he added. Ceypetco requested the cargo for delivery on July 29-30, on a cost-and-freight Colombo basis. The tender will close on Tuesday and stay valid for another 48 hours.

Naphtha’s outright benchmark open-spec prices in Asia were pegged at $1,230.00 a tonne in the last session, a record high, but still lower than the 0.5 percent sulphur gas oil’s spot quotes in Singapore, at $1,286.62.

Some of Sri Lanka’s power generators can run on both diesel and naphtha, so they could switch to the latter for lower costs, the source said.