Courtesy The Daily Mirror

Colombo, Feb. 4 (Daily Mirror) – Sri Lanka’s ambition to become an oil-producing nation has faced a setback, with the planned international tender process for offshore oil and gas exploration and development delayed due to a court case initiated in the past, an official said yesterday.

The Sri Lanka Petroleum Development Authority (SLPDA) had planned to call for international bids early this month. However, the process could not be initiated because of the ongoing legal issue.

Exploration conducted in 2011 by India’s Cairn India identified hydrocarbon deposits in two wells—Barracuda and Dorado—in the Mannar Basin.

The Petroleum Resources Act No. 21 of 2021 stipulates that oil and gas exploration and development must be undertaken through an international competitive bidding process. Sri Lanka’s offshore area consists of four sub-basins—Cauvery, Mannar, South Lanka and East Lanka—with past discoveries confirming a proven petroleum system in the Mannar Basin.

The international bidding round was initially scheduled to be launched in December. However, it was delayed after the Attorney General’s Department requested additional time to review and clear the related documents.

Commenting on the current status, Ceylon Petroleum Corporation (CPC) Chairman D.A. Rajakaruna said the tender process would be further delayed due to unresolved legal issues.

We are now in discussions with the Attorney General’s Department to clear all outstanding matters. The tender process will be initiated once everything is resolved,” he said.

According to a 2021 press release issued by the Parliamentary Media Unit, oil and gas resources in the Mannar Basin have been valued at approximately US$ 267 billion.

Meanwhile, oil companies from countries such as Qatar and India have already expressed interest in participating in Sri Lanka’s oil and gas exploration and development projects.