TO START OIL EXPLORATION ACTIVITIES IN THE BAY OF MANNAR VERY SOON, SAYS ONGC VIDESH LTD.

By Walter Jayawardhana

India’s state owned Oil and Gas Corporation Videsh Ltd. has announced that it will explore for oil and gas in Sri Lanka’s Mannar basin very soon.

The ONGC Videsh Ltd said the company’s own experience in India’s Kaveri basin would help them to explore oil and gas in the neighboring Sri Lanka.

It has been speculated by geologists that the same Kaveri oil deposit string also runs beneath Sri Lanka’s Mannar bay.

In the 1960’s Soviet explorers attempted to dig wells in the area unsuccessfully. The not so advanced technology then is believed to have prevented the Soviets from hitting the black gold in Sri Lanka, four decades ago.

India’s overseas arm of exploration, ONGC Videsh Ltd. said it is now looking to buy assets in Sri Lanka for exploration of oil and gas.

R.S.Butola, Chairman and Managing Director of the ONGC Videsh Ltd. said his corporation has already procured seismic data that indicate potential oil deposits from the Norwegian company that had done seismic surveys around the Sri Lankan coast.

ONGC Videsh said that it had proposed to Sri Lanka that it would share its experience in the sector for developing data and other activities in the exploration and production of gas and oil.
Based on the friendly relations between the two countries Sri Lanka has actually offered few blocks of exploration to India on a priority basis.

In exchange India has offered to extend value added information in exploration activities, The Business Line newspaper of India reported Tuesday. The initial seismic studies were done in 2002 by a Norwegian Company.

But the company’s contract was discontinued by the present government over serious disagreements with the Norwegians.

The Sri Lanka government will soon invite companies to bid for oil and gas exploration rights after studies have indicated potential oil deposits off the island's western coast. 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. It is the closest block to India and that has been offered to India without any bidding considering the friendly relations with the country.