Sri Lanka to Seek Help from India, Japan in Setting Up LNG Based Power Plants

The Sri Lankan government has decided to consult the Indian and Japanese governments to invest in LNG based power plants.

According to local news outlet News First, the decision was made after the cabinet sub-committee on economic management made inquiries over the energy requirements. The government has decided to look into ways to convert Kerawalapitiya power plant into gas based one.

Earlier this month, Saliya Wickramasuriya, director general of the Petroleum Resources Development Secretariat, told Lanka Business Online, a news portal, that there is a compelling case to initially start gasifying Sri Lanka using imported LNG and then move towards using domestic gas. He added that this move will also help the economy move away from coal.

He also said that Sri Lanka needs to find proactive ways of commercialising indigenous offshore gas reserves if the country is to deliver natural gas at a competitive price. Sri Lanka has gas deposits off its eastern and western coasts. In February, French energy major Total signed an agreement with government of Sri Lanka to explore two ultra-deep water blocks off the east coast. The duration of this agreement includes a period of two years from the effective date for data acquisition and for processing and interpretation.

Last year, Cairn India which struck gas in Mannar Basin decided not to go ahead with further exploration. In July 2008, the government of Sri Lanka and Cairn India signed an agreement for exploration licence permitting Cairn India to explore oil and natural gas in Mannar Basin. The Block SL 2007-01-001, which is in offshore northwest Sri Lanka and covers approximately 3,000 Km2 in water depths of 200 to 1,800m, was awarded to Cairn India through a bid round held in 2008.