- Focus on developing Trinco oil tank farm
- Talks held with UAE, Saudi, Kuwaiti and Qatar envoys
- New refineries proposed
The Ministry of Power and Energy has initiated preliminary work on establishing Sri Lanka as a petroleum hub in the South Asian region.
Discussions in this regard were held with Ambassadors of the United Arab Emirates (UAE), Kingdom of Saudi Arabia (KSA), Kuwait and Qatar last week, Ceylon Petroleum Corporation (CPC) Chairman, Janaka Rajakaruna told the Sunday Observer yesterday.
The discussions were focused on developing the Trincomalee tank farm and the construction of new oil storage tanks in Trincomalee.
“Considering the geographical location of Sri Lanka and the advantages of the Trincomalee harbour, Sri Lanka can become a regional hub to refine and export petroleum products,” Rajakaruna said.
The Ambassadors will visit Trincomalee today (12) to inspect the tank farm site with Minister of Power and Energy, Kumara Jayakody. The delegation will also visit the proposed site of a new berth to be constructed to dock oil tankers and a site for a new petroleum refinery.
Rajakaruna said that positive responses were received from all three countries. The Ambassadors have agreed to start technical discussions soon. Industrial sector delegations are due to visit Sri Lanka shortly for comprehensive discussions.
The Qatar Ambassador has agreed to start a Liquefied Natural Gas (LNG) bunkering project in Colombo based in Kerawalapitiya. This will also be in line with the conversion of thermal power plants at the Kelanitissa power plant in Colombo to LNG within a short period.
The Government’s top priority in the power sector is to convert all thermal power plants to low cost LNG. This was also a key point in the National People’s Power (NPP) manifesto as a means of reducing electricity tariffs.
The discussion with the Ambassadors also focused on the possibility of purchasing fuel under Government to Government (G2G) agreements with long-term contracts and without any intermediaries. This discussion was also on the construction of a refinery.
The CPC is planning to construct another refinery in Sapugaskanda and a feasibility study has also been completed, Rajakaruna said. The possibility of constructing the refinery as a joint venture was also discussed.
India has also expressed an interest in the petroleum sector development projects in Trincomalee. Expressions of Interest (EOI) have been called to set up Trincomalee Petroleum Terminal Limited (TPT), a joint venture between CPC and Lanka Indian Oil Company (LIOC).
This project will be based on the 61 oil tanks in Trincomalee leased to India. Sri Lanka has expressed interest in holding 51 percent of the shares of this joint venture. This will also be an international oil storage facility targeting the export market.
