By Yohan Perera
Sri Lanka will become an oil and gas producing nation by the year 2022, as the island nation steadily moves ahead with plans to develop its offshore hydrocarbon potential, Petroleum Resources Minister Kabir Hashim said.
The government through the Petroleum Resource Development Secretariat (PRDS) yesterda, entered into an agreement with the French oil and gas supermajor Total E&P with the inclusion of the Norwegian oil and gas company Equinor ASA as a joint study partner to explore hydrocarbon potential in the JS-5 and Js-6 blocks of the Lanka Basin in the Eastern offshore region.
In 2018, the 50,000 km2 two joint study blocks saw the largest ever 2D seismic survey carried out in Lanka Basin, where 5, 000 line kms were acquired.
The data from this seismic survey revealed that the two blocks carry significant hydrocarbon potential, and as a result Total E&P has decided to move forward to the next phase of exploration with Equinor ASA as a joint venture partner.
“I am happy to be associated with this process today as it is an important moment for Sri Lanka. We are gaining grounds in the oil and gas exploration process.
“A week ago we had an event where we launched airborne magnetic data processing. We signed an agreement and set it off. We are now going forward and working with two important countries,” Minister Hashim said. He added that the two companies and the Sri Lankan government will come to an agreement on sharing oil and gas in the event such resources were found in the said blocks.
Benefits of joint study agreements include free access to new geophysical data, knowledge and technology transfer and utilization of local goods and services during operations.
According to PRDS Director General Vajira Dassanayake, the inclusion of Equinor ASA as a third partner to the study opens up a whole new level of the benefits to the country as it will provide additional financial provisions towards Total E& P to carry out further geophysical and geological studies in the region. Meanwhile, Minister Hashim said the government will soon award a tender to a suitable company to begin developing a block where gas deposits had already been found. “We are in the process of awarding a tender for a suitable company to begin the digging operations. In 2022 Sri Lanka will be an oil and gas producing nation,” he said.
Gas deposits were discovered in the M2 block in Mannar Basin by Cairn India in 2011.
However, the company did not develop the block as its new owners wanted to focus on the firm’s Indian operations as gas prices fell.