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The inauguration of the newly refurbished Litro Gas Storage Terminal Complex situated in Kerawalapitiya took place last week with President Mahinda Rajapaksa as the chief guest.
The President’s visit coincided with the celebration of a Year of Excellence under the Litro Gas brand and the unveiling of the plans for a new state-of -the -art Filling Plant which will be located adjacent to the existing Litro Gas Storage Terminal Complex.
President Mahinda Rajapaksa opening the terminal
This was organized by the new management to celebrate the success of the new Litro Gas brand and a year’s successful operation since the buyout of Shell Gas in November 2010 by appreciating the top performers amongst the Litro Gas Dealers and Distributors.
The company has a proud heritage which goes as far back as 1868.
The Colombo Gas and Water Company was founded in the United Kingdom during that year and shares were advertised in the Sinhala news papers in Ceylon with the Ceylonese being offered 2500 shares. The objective of setting up the company was to provide street lighting, cooking gas and water to the city of Colombo. The company constructed a plant in Pettah for the gasification of coal, and this street was appropriately named the `Gas Works Street’.
Although the company was growing steadily, it experienced financial losses. On 24th February 1975, the Government took over the company through the Extraordinary Gazette Notification no 152/2 of 24 February 1975 issued under The Business Undertakings (Acquisition) Act no. 35 of 1971. After illuminating the streets of Colombo for 120 years, the Company’s name was changed to `The Colombo Gas Company Limited’ in 1992. Under the Public Enterprise Reform Commission (PERC) established in 1994, the Colombo Gas Company was privatized with the objective of obtaining private investment to develop the infrastructure to support the growing demand for LPG, introduce world-class safety standards to the market and to maximize revenue to the government.
Tenders were called for the sale of the company and since the global multinational oil giant Shell was the highest bidder, 51% shares were sold to the Shell Group for US $ 30 million in December 1995. In June 2010 the Shell Group expressed its interest to divest its controlling interest in Shell Gas Lanka Ltd. and Shell Gas Lanka Terminal Ltd and exit from the LPG business in Sri Lanka. Several parties, both foreign and local interested in the business.
The new terminal at Kerawalapitiya.
When Shell decided to divest their International LP Gas operations in November 2010, His Excellency The President Mahinda Rajapaksa understanding well that LPG is an essential commodity for the people, took a far sighted decision to acquire the shares of Shell Gas Lanka Limited and Shell Terminal Lanka (PVT) Ltd through the Sri Lanka Insurance Corporation Limited in keeping with the Mahinda Chinthana Vision for the nation.
Sri Lanka Insurance paid Shell $ 63 million in November 2010 to buy the 51% controlling share of the joint venture Shell Gas Lanka Ltd that the Government of Sri Lanka did not already own, along with 100% of Shell Terminal Lanka Ltd, which operated the 8,000 ton LPG Terminal at Kerawalapitiya.
The new companies were named Litro Gas Lanka Limited and Litro Gas Terminal Lanka (Pvt) Limited under the Companies Act, making them 100% government owned entities with a complete private sector management and business model.
When Litro Gas embarked on the `transformation’ journey under the new brand, times were tough. Externally, competition was hitting hard, internally, de-branding of a `global’ brand and the launch of a new brand had to be done. However, within a short span of time, the Company achieved excellent results under the new Litro Gas management. Today, after one year of operations as Litro Gas, the Company stands strong with annual sales of more than 150,000 tons of LPG, a market share of 75% and a turnover exceeding Rs. 20 billion.
Some of the key achievements of Litro Gas during the past year are: ú
Successfully establishing one price formula for the entire industry.
Securing equal access to the locally produced LPG from the CPC refinery.
Investing and injecting over 250,000 new cylinders to grow and develop the market and to convert non-users to LPG.
Investing in upgrading the Filling Plant and Terminal Complex to provide a better service to Litro Gas customers.
Invested in modernized trucks to ensure uninterrupted delivery of LPG to customers.
Continuing to invest in promoting and positioning the Litro Gas Brand as a leading `local’ brand in the industry.
Entering into strategic alliances with COOPFED and SINGER to promote LPG in order to convert households using firewood for cooking through easy payment schemes. This would help these households to reduce smoke pollution and lead a healthy life whilst saving valuable time by cooking with Litro Gas LPG.
Litro Gas Excellence awards were also presented to dealers by President Mahinda Rajapaksa and here Proprietor, EPB De Zoyza and Sons, Mahabage, M. D. Piyadasa Kudabalage, is seen receiving his Exceptional Performance award from President Mahinda Rajapaksa. Picture by Sudath Malaweera
Embarking on several efficiency improvement and cost reduction projects which have already contributed to the bottom line of the company.
Due to a +10% volume growth and a 25% revenue growth Vs. last year, the turnover of this financial year gave the company a healthy bottom-line growth.
In 2012, the company hopes to spear ahead with the following:
Continue to raise the company’s Safety Performance and Standards.
Reduce costs and improve efficiencies by moving the Filling Plant from Sapugaskanda to Kerawalapitiya, thereby eliminating transportation by road.
Decentralize operations by operating a Storage and Filling Plant in Hambantota.
Invest heavily on improving the appearance of cylinders and inject new cylinders into the market.
Continue to focus on segments that are strategic.
Build on the promotional success with longer and wider promotions in 2012, including grass root campaigns to improve the over-all image of Litro Gas.
