The case filed by five parties, including four trade unions, alleging that the Indian Oil Company (IOC) is illegally using the oil tanks at the China Bay in Trincomalee without any lease agreement is due to be heard in the Supreme Court tomorrow (16).
On February 7, 2003, Charitha Ratwatte, then Secretary to the Ministry of Finance, Daham Wimalasena, Chairman of the Ceylon Petroleum Corporation and Nageshwaran of the Indian Oil Company had agreed to reach a final agreement within six months following a preliminary agreement.
Accordingly, 14 of the 99 tanks in the Chinese port are in use and it was agreed to pay US $ 1,000 per year for each tank.
However, according to the preliminary agreement, an agreement had to be reached between the Ceylon Petroleum Corporation and the Indian Oil Company by August 7, 2003, but it has not been done and the unions claim that IOC has therefore been using the tanks illegally for 17 years. The trade unions also allege that one of the 14 oil tanks used in this manner has been demolished and two smaller tanks have been built illegally.
The average annual rent paid by the Indian Oil Company to the Government of Sri Lanka for an oil tanker is around Rs. 180,000.
At present 14 tanks towards the Trincomalee port are being used by the Indian Oil Company and 85 tanks set up in the country west of the Chinese port are unused and further decaying.