Historic oil exploration deal signed with India

The epoch-making Petroleum Resources Agreement was inked between Sri Lanka and India for the exploration and production of oil in Northern Sri Lankan waters in the Mannar basin, at Temple Trees yesterday with President Mahinda Rajapaksa presiding.

This historic agreement signed between Sri Lanka and India will now pave the way for the exploration and production of natural gas and hydrocarbon resources yet untapped by the nation.

The agreement was signed by Petroleum and Petroleum Resources Minister A..H.M. Fowzie for Sri Lanka and Indrajit Benerijee, the Chief Financial Officer of Cairn (Pvt) Limited of India.

A ‘Bonus Cheque’ of US $ one million was also handed over to President Rajapaksa, following the inking of the agreement.

Minister Fowzie addressing the participants at the signing ceremony, asserted that it was a ‘ray of hope’ in relieving all Sri Lankans from the ongoing global fuel crisis which has also plunged the whole world into a ‘coma’.

He thanked President Rajapaksa for his unstinted and concerted effort and his foresight in making this milestone venture a successful reality.

The Chief Financial Officer Cairn (Pvt) Limited Indrajit Benerijee noted that they were delighted to participate in this great venture as the first ‘Licencee’, to make Sri Lanka less dependant on oil imports.

Benerijee said the best practices and technology available in the sphere would be deployed in the process.

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Lanka IOC further reduces diesel price by Rs.10

The Lanka Indian Oil Corporation (LIOC) Thursday heeded the government's request and further reduced the price of diesel by 10 Sri Lankan rupees to bring it on par with that of state-owned Ceylon Petroleum Corporation (CPC).

"The Lanka IOC reduced diesel price by 10 rupees per litre and matches CPC price of 110 rupees per litre with effect from 00:00 hours of Friday," Lanka IOC managing director K. Ramakrishnan said Thursday, adding that the price of LIOC petrol would continue to match that of CPC at Rs.157 per litre.

This is the second price reduction by the LIOC within 48 hours, a week after Petroleum Minister A.H.M. Fowzie warned of takeover of all 153 LIOC outlets if the company did not bring its diesel price on par with CPC.

On Tuesday, LIOC reduced the diesel price by Rs.10 per litre.

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Sri Lanka govt warns of possible takeover of IOC filling stations

Sri Lanka's Minister of Petroleum A.H.M. Fowzie today said that he has sent written notices to the Indian Oil Company (IOC) on a possible takeover of filling stations operated by the company.

Speaking in Parliament, the Minister pointed out that the government is incurring heavy losses by selling diesel and kerosene oil at lower prices.

He said the IOC has avoided this crisis by selling diesel at higher prices and by stopping its sale of kerosene oil. This practice has worsened the government’s situation as almost all consumers come to the government-owned CEYPETCO filling stations to buy kerosene and diesel, he explained.

Meanwhile, the government’s chief whip Dinesh Gunawardane pointed out that steps have been taken to draft a national policy on fuel consumption. He added that accordingly, a restriction may be imposed on vehicles with high fuel consumption.

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Special committee for oil exploration

The Petroleum Resources Development Ministry has decided to appoint a Special Committee represented by all political parties in Parliament to supervise oil exploration activities in Sri Lanka.

Leader of the House Minister Nimal Siripala de Silva yesterday told Parliament a decision was taken at the Party Leader’s meeting held on February 6 to inform all political parties to nominate their representatives to this committee.

The Minister was responding to a question raised by JVP Parliamentarian Wimal Weerawansa regarding an assurance given by Petroleum Resources Development Minister A.H.M. Fowzie at the Budget debate to appoint a committee to supervise oil exploration.

Weerawansa said, however, the Minister has not yet taken steps to appoint this Committee.

Minister Fowzie agreed in this House to suspend the calling for tenders and appoint a Committee represented by all political parties to supervise oil exploration before these tenders are called.

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Lanka inviting Qatari, global energy firms to bid for 3 blocks

Sri Lanka has invited Qatari as well as international energy companies to participate in the bid for oil exploration in three offshore blocks in the country’s northwest.

Sri Lanka’s Minister of Petroleum, A H M Fowzie said the tender would be closed in January and the bid would be awarded sometime in 2008.

A recent study commissioned by Sri Lanka and initiated by an Australian firm revealed the country had oil reserves in excess of 1bn barrels.

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Oil exploration: Lanka eyes experienced companies

Sri Lanka has called for bids for oil exploration from oil companies that have experience in the field, Petroleum and Petroleum Resources Minister A.H.M. Fowzie on transit at the King Khalid International Airport told Daily News.

Fowzie who was enroute to the Sixth Doha Conference on Natural Gas, came to the Kingdom to perform Umrah and visit the Prophet’s Mosque in Madinah. The Minister said the bids for this tender will close in January 2008.

“We want to get the right party to carry out the exploration since the seismic survey carried out in 2002 had indicated that the Mannar Basin could produce 1 billion barrels,” Fowzie said. Mannar Basin covers an area of 35,000 km, stretching from Mannar to Kalutara.

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