Sri Lanka’s energy procurement process has come under renewed scrutiny following state-owned Litro Gas Lanka’s decision to award its largest annual liquefied petroleum gas (LPG) supply contract to Switzerland-based Geo Gas Trading SA, sidelining long-standing supplier Oman Trading International.
The tender, which will cover the country’s entire domestic LPG requirement for 2026, has triggered controversy amid claims of abrupt contract termination, procedural rigidity and inadequate consideration of transitional requests.
The Cabinet of Ministers recently approved the award of a 12-month contract to Geo Gas Trading SA to supply 380,000 metric tonnes of LPG, with a permissible variation of plus or minus 20 percent, beginning January 2026. Litro officials have stated that the decision followed an international competitive bidding process and that the Swiss firm emerged as the lowest evaluated bidder after technical and commercial assessments.
However, the outcome has drawn sharp criticism from industry stakeholders, particularly Oman Trading, which has supplied LPG to Sri Lanka over several years.
The company has reportedly objected to the cancellation of its existing supply arrangement without accommodating a requested three-month extension, which it argues was necessary to ensure continuity and avoid supply disruptions during the transition period.
Oman Trading has claimed that its proposal met Litro’s updated tender specifications and that its long operational history with the state supplier was not adequately factored into the final decision.
Litro Chairman Channa Gunawardana has confirmed that Geo Gas Trading SA is a new supplier for Sri Lanka and that most of its LPG will be sourced from the United States, marking a departure from the Middle East-centric sourcing pattern used previously.
While Litro maintains that the Swiss trader fully complied with revised technical standards covering product purity, calorific value, cylinder compatibility, shipping safety and delivery timelines questions persist over the evaluation process that disqualified three out of five bidders at the technical stage.
Geo Gas Trading SA is headquartered in Switzerland, a hub for global commodity trading, yet it remains a relatively unfamiliar entity in Sri Lanka’s energy landscape.
Industry analysts note that publicly available information on the company’s track record in supplying large-scale LPG volumes to state utilities, particularly in South Asia, is limited.
This has intensified calls for greater transparency, given the critical nature of household LPG and its direct impact on cost of living and public safety.
Critics argue that while competitive pricing is essential amid Sri Lanka’s fragile economic recovery, procurement decisions involving essential commodities must also weigh supplier experience, continuity of supply and transition risks. The refusal to grant a short extension to an incumbent supplier, they say, warrants clearer justification.
As Sri Lanka continues to emphasise governance reforms and transparency under broader economic restructuring efforts, the Litro LPG tender is emerging as a test case. Whether Geo Gas Trading SA delivers seamlessly in 2026 or whether the decision becomes the subject of audit or parliamentary scrutiny will depend on how effectively the contract is executed and how openly Litro addresses the concerns now being raised.
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