LAUGFS Gas PLC has arranged three LPG shipments expected to arrive in Sri Lanka during November and is working with the relevant authorities to secure approvals for domestic supplies through its Hambantota terminal.

The Company sincerely regrets the hardship caused to households and businesses by the current supply disruptions. As a Sri Lankan company serving the domestic LPG market for more than 25 years, LAUGFS remains committed to restoring availability and strengthening long-term supply reliability.

Expected November shipments

These dates remain subject to shipping arrangements, port operations and applicable regulatory approvals. Domestic releases from the Hambantota shipments require the necessary authorisations. Distribution is expected to resume progressively following receipt and clearance of the cargoes.

Supply challenges and the Hambantota terminal

Conflict in the Middle East and disruptions to maritime transport through the Strait of Hormuz have affected international LPG supply chains, creating procurement and shipping difficulties for Sri Lanka and other importing countries.

To strengthen Sri Lanka’s LPG supply security and support regional trade, LAUGFS Terminals Limited (LTL), a wholly owned subsidiary of LAUGFS Gas PLC, invested US$65 million in its Hambantota import and export terminal, which commenced operations in 2019. With 30,000 metric tonnes of storage capacity, it is Sri Lanka’s largest LPG receiving, storage and entrepôt terminal.

The project received capital goodsimport-duty concessions under the Board of Investment’s Commercial Hub framework, subject to the applicable conditions. Under the relevant Hub Regulations, domestic releases are linked to 40% of annual re-export turnover by value. This is an export-linked operating condition, not a restriction on LAUGFS Gas’s domestic market share.

The COVID-19 pandemic, Sri Lanka’s economic and political crisis, foreign-exchange shortages and sovereign credit-rating downgrades disrupted LTL’s ability to maintain the required re-export levels. The resulting regulatory restrictions have limited the terminal’s availability for domestic supply despite its substantial storage capacity.

Temporary permission previously granted by the Ministry of Finance under Emergency Regulations ceased when those regulations ended.

Steps to enable domestic supply

LTL has requested three months of temporary permission to use the Hambantota terminal for domestic LPG supply. In parallel, the Company is working with the BOI, Ministry of Finance, Sri Lanka Customs and the Department of Imports and Exports Control to complete its transition out of Hub status and establish the necessary operating arrangements, with applicable duties and taxes payable.

The BOI Chairman confirmed to the Company today that, following instructions from His Excellency the President, he had written to the Secretary to the Treasury requesting that the necessary approvals be facilitated within one week. These approvals remain pending. LAUGFS appreciates the Government’s intervention and the cooperation of the relevant authorities.

As an additional supply safeguard, LAUGFS Gas has also called a new tender for direct LPG deliveries to Colombo commencing in January 2027.

Clarification on OFAC designation

LAUGFS Gas PLC and LAUGFS Terminals Limited are not itself entities designated by the United States Department of the Treasury’s Office of Foreign Asset Control (OFAC). The Company remains committed to applicable regulatory and compliance requirements and to maintaining transparency with its stakeholders.

LAUGFS Gas PLC appreciates its customers and business partners for their patience and will provide further updates as shipment arrivals and regulatory approvals are confirmed.