Sri Lanka’s Cabinet has approved the award of a major aviation fuel infrastructure contract to China Petroleum Pipeline Engineering Company Limited, covering the construction of facilities to transport aviation fuel from Muthurajawela to Bandaranaike International Airport.
The contract, valued at US$40.84 million and Rs. 8.548 billion, including taxes, was approved by the Cabinet following an international competitive procurement process. The award was based on the recommendation of a high-level procurement committee after three bids were submitted and evaluated.
The project involves the construction of an aviation fuel storage tank complex at Muthurajawela with a total capacity of 92,000 cubic metres, together with associated facilities. It will also include a dedicated fuel pipeline connecting the storage facility to the fuel filling terminal at Bandaranaike International Airport, as well as modifications to the existing terminal at Muthurajawela.
The Cabinet approval follows an earlier decision taken at its meeting on 29 July 2024 to proceed with the project. The latest decision authorises the contract to be awarded to M/s. China Petroleum Pipeline Engineering Company Limited for a combined payment of US$40.84 million and Rs. 8,548.75 million, inclusive of taxes.
The procurement was conducted through an international competitive bidding process, with three bids submitted for consideration. Following evaluation of those bids, the high-level procurement committee made its recommendation, which formed the basis for the proposal submitted by the Minister of Energy and subsequently approved by the Cabinet.
China Petroleum Pipeline Engineering Company Limited is the company identified in the Cabinet decision as the successful bidder for the project. The source provides no further information on the company’s ownership, corporate structure, previous projects or other business activities, beyond its role as the successful bidder for this contract.
The planned infrastructure is centred on establishing a 92,000-cubic-metre aviation fuel storage capacity at Muthurajawela and creating a dedicated connection between that facility and the airport’s fuel filling terminal. The works will also require changes to the existing Muthurajawela terminal to accommodate the new system.
The contract award therefore covers the principal infrastructure required for the proposed fuel transportation arrangement, including storage, pipeline connectivity and modifications to the existing terminal facilities. The Cabinet decision specifies that the approved contract price is inclusive of taxes, comprising both the US-dollar component and the Sri Lankan rupee component.
The project’s procurement process began after Cabinet approval was granted in July 2024, followed by the invitation of bids under international competitive procurement procedures. After the three submitted bids were evaluated, the recommendation of the high-level procurement committee led to the selection of China Petroleum Pipeline Engineering Company Limited and the Cabinet’s approval of the contract at the stated value.
