Sri Lanka to allow India and China to explore for oil

Jul 10, 2006 02:00 AM

The Sri Lankan government has decided to allow India and China to explore for oil along its coast. India and China will be allowed to explore two of the six blocks identified for oil exploration off the island nation's northwest coast, Petroleum Resources Development Minister A.H.M. Fowzie was quoted as saying.
"The proposal received Cabinet approval this week. We will shortly call tenders for exploring the four remaining blocks," Fowzie said.

Sri Lanka, which now imports all of its oil and gas, might be able to produce oil within 3 years if exploration efforts were successful, according to the Petroleum Resources Development Ministry, which was established in 2005 to help facilitate the country's oil and gas exploration efforts. The Gulf of Mannar, between the southern tip of India and the west coast of Sri Lanka, has been identified for the first phase of oil exploration, which is likely to begin in August 2007.
Fowzie said many countries engaged in the oil trade, including giants Saudi Arabia and Iran, have been told about opportunities in Sri Lanka and have provided technical assistance and expertise for local oil exploration.

In October last year, a Norwegian seismic survey company, after completing a second phase of studies, said there may be oil and natural gas reserves off the west coast of Sri Lanka. An earlier survey had showed the possibility of small hydrocarbon reserves in the northwest Gulf of Mannar.
From the mid-1970s to the mid-1980s, overseas companies had explored areas off Sri Lanka's coast but failed to find any oil or gas reserves.

Source: Xinhua Financial News
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