Energy Minister claims $ 267 b of oil and gas resources hidden in Mannar Basin

Minister of Energy Udaya Gammanpila has said that the $ 267 billion worth of oil and gas resources hidden in the Mannar Basin could generate three times the total debt of the country.

The Energy Minister made this claim at the Consultative Committee on Energy held in Parliament Tuesday (07), the Parliament Communication Department said in a communiqué.

The Minister further stated that although investors who invest in these oil and gas drills are given 50%, $ 133.5 billion is Government-owned and it is almost three times the total debt value of the country which is a total of $ 47 billion.

The Minister made this observation while briefing the Committee, including Parliamentarians, on the Petroleum Resources Bill to be tabled in Parliament for the second reading. Accordingly, the Bill was approved by the Committee.

The Minister further stated that this Bill, which seeks to regulate and manage the exploration of petroleum resources, including the establishment of the Petroleum Development Authority of Sri Lanka, would be presented to Parliament as a matter of priority for the Government.

Gammanpila said that the Norochcholai power plant could operate for 120 years solely from utilising the gas in the Mannar Basin, while the Sapugaskanda oil refinery could operate for 143 years with oil alone.

Although neighbouring India has been extracting oil and gas from the seas close to Sri Lanka since the 1940s, Sri Lanka has missed out due to various reasons. After lengthy discussions with experts on the subject, it was identified that there several reasons had contributed to this, stated the Minister.

The Minister said large companies around the world had not come to explore oil resources in Sri Lanka in the recent past due to various reasons.

“We took steps to hand over this task to experts on the subject matter through the establishment of the Petroleum Development Authority, given the lack of understanding on the scope of subject by the officials who were to take decisions in this regard previously. Also, as regulatory powers, such as the issuance of licenses, were completely concentrated in the hands of the subject Minister, all activities had been disrupted when there was a change of the Minister. Therefore, we have decided to transfer all the powers of the Minister to the Board of Directors of this Authority. Also, a modern map was prepared to replace the existing traditional map for oil and gas exploration,” the Minister added.

The Bill will also introduce a strong legal framework to protect these large investments and appoint a special committee to advise the subject Minister, as billions of dollars will have to be invested in the industry, the Minister of Energy said.

Furthermore, Gammanpilla pointed out that while the Norwegian government had to dig 31 wells for one success story, 3 out of 4 wells drilled in Sri Lanka were successful.

He also stated that he intends to seek the assistance of Sri Lankan experts in the field from around the world in this regard.

Committee Members State Minister Jayantha Samaraweera, Members of Parliament Chandima Weerakkody, Nalin Bandara, Muditha Prishanthi, Gunathilaka Rajapaksha, and B.Y.G Ratnasekera, and the Secretary to the Ministry K.D.R. Olga, were present at the meeting.