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ONGC, IOC Eye Business in Lanka

Bids for 7 blocks in Mannar Basin in 3 months

  • State-run oil companies such as ONGC and IOC have proposed to cash-in on exploration and refining opportunities in Sri Lanka. Both companies have visited the island country and reviewed opportunities that could be grabbed by them.Sri Lanka would call for bids for seven oil and gas blocks in Mannar Basin in next two-three months, Susil Premajayantha, minister of petroleum of Sri Lanka said at second Asia Energy Summit. Indian companies such as ONGC and IOC have visited Sri Lanka and discussed opportunities, Premajayantha added.

  • Summit held by Independent Power Producers Association of India (Ippai) in Colombo discussed co-operation for energy security, stability and sustainability in the region.In 2008, Sri Lanka awarded exploration rights for the block SL 2007-01-001 in Mannar basin to Cairn India. At present, no oil or gas is produced in the island country.Cairn has completed first phase of the exploration campaign in the Sri Lanka block, a company statement said on December 26, 2011. The exploration programme involved acquisition, processing and interpretation of 3D seismic data and a three well deep-water drilling programme.

  • “This programme resulted in two successive gas and condensate discoveries — CLPL-Dorado-91H/1z well and CLPL-Barracuda-1G/1 well. The third well, CLPL-Dorado North 1-82K/1 was plugged and abandoned as a dry hole on December 14, 2011,” Cairn has said.At the same time, Sri Lanka is looking to set up new refinery to meet its increasing demand. It only operates single 40,000 barrels per day refinery.IOC representatives visited us and we have asked them to submit a feasibility report for setting up of a refinery, said Premajayantha.

  • The refinery sources crude oil from Iran and recent sanction imposed by the US and EU over the Islamic country has created uncertainties for Sir Lanka.“It’s sanctions imposed to small countries like us. We are suffering. We have an old refinery and use of other crude would be very expensive. Problems should be solved through diplomatic channels,” Premajayantha added.Harry Dhaul, director general of Ippai, pointed out when the seller and buyer both are Asian, why should a third party (read the US and EU) should dictate the terms?

  • Crude oil price has zoomed beyond $ 123 per barrel and supply certainties have emerged for Asian buyers of crude oil such as India, Sri Lanka, China and Japan. Earlier, Iran said that it has halted exports to British and French companies. Other buyers such as Belgium, the Czech Republic and the Netherlands are also not buying Iranian crude oil. Few others such as Greece, Spain and Italy are drastically cutting down on supplies from Iran.

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