Business

Sri Lanka is ready to complete the selection of a marketing consultant this week to proceed with calling for bids for commercial extraction of offshore natural oil and gas reserves in the Mannar basin soon, an informed source said. The government earlier called for tenders to select a consultant firm with expertise to carry out the international bidding process for upstream petroleum development. In Sri Lanka, a national policy on natural gas was gazetted in September 2020, outlining domestic demand creation strategies and providing operators with options to commercialise offshore gas. A new Petroleum Resources Act No. 21 of 2021 has also been introduced to regulate the process. The Petroleum Development Authority of Sri Lanka (PDASL) has also been established as the independent upstream regulator. According to the source familiar with the process, the companies from India and Qatar have already expressed interests in the process in Sri Lanka Though commercially viable natural gas reserves have been identified in different locations in the country , the government initially plans to undertake investment in four blocks of the Mannar basin According to a 2021 press release from the parliamentary media unit oil and gas resources valued US $ 267 billion are available in the Mannar Basin.

The Sri Lankan government signed an agreement with the company, Cairn India Limited, in 2008 to explore for oil and gas off the country's north-western coast. Cairn Lanka Limited, a subsidiary of the Indian firm, In 2011, drilled two exploration wells in the Mannar Basin and found natural gas in the Barracuda and Dorado fields. It was considered too expensive at that time to extract,though.