The natural gas deposits in the Mannar basin have not been included in the Ceylon Electricity Board’s (CEB) US $ 6.6 billion 20-year power generation expansion plan, which was submitted to the Public Utilities Commission of Sri Lanka (PUCSL) for approval and public consultation.
This is despite former Power and Energy Minister Champika Ranawaka making progressive comments about converting the country’s entire crude oil dependency—including in motor vehicles—into natural gas, probably without taking into consideration the nitty-gritty of the process.
The plan said that natural gas in the Mannar Basin has not been taken into consideration for the upcoming 20 years due to the infancy in exploration and quantification, as well as the steep costs.
It said that natural gas purchased from the Mannar Basin would cost US $ 15.5 per million of British thermal units (MMBTU) and an additional US $ 1 would be added per unit in transport costs.
The breakeven price has been calculated at US $ 8.7 per MMBTU if commercial operations start by 2021. The current global price for natural gas is US $ 2.7 per MMBTU.
The plan added that converting the current oil turbines to gas turbines—as mentioned by Ranawaka—may be costly and further doubts hang over the price of gas due to the lack of infrastructure to support the fuel form.
Cairn India, which was the sole bidder for four of the blocks in 2007, will exit the exploration and drilling contract signed with the government this November and new bids are being called. Just two of the four wells dug produced gas deposits.
Meanwhile, the CEB plan focuses on the addition of the Mannar Wind Farm and other hydropower plants as non-conventional renewable energy, while solar, biomass and other wind power plants are expected to be operated by private parties.
However, coal-fired power plants will be generating the largest amount of electricity for the next 20 years.
The 500MW Sampur coal power plant will be commissioned in 2020, according to the report, despite Ranawaka saying pre-elections that it will be commissioned by 2017.
His comments on national self-sustainability in power by 2025 have also been proven invalid, as Sri Lanka imports all coal and the CEB is set to continue operating the diesel-fired Kelanitissa combined cycle plant after the private power purchase agreement expires in 2023.
According to the plan, the 1,200MW Japanese-assisted clean coal power plant is expected to come up in phases in Trincomalee and a 1,500MW coal power plant will be coming up in phases in the Southern region.
Except the Kelanitissa combined cycle plant, all other oil, diesel and gas-powered power plants will be decommissioned.
The plan said that 4,800MW will be available in the grid by 2020, in line with demand forecasts, which are set to increase by 6.24 percent annually till 2020.
It gives a comprehensive view of the existing generating system, future electricity demand and future power generation options in the country. It also provides detailed information on generation planning methodology, system demand forecast and investment and implementation plans for the proposed projects.
With the view of receiving public consultation, alternative proposals, opinions and suggestions, the PUCSL has published the plan on its website at www.pucsl.gov.lk and the PUCSL information centre. Submissions can be made through post, fax, e-mail and on the website before September 21.
Further, the PUCSL will hold a key stakeholders meeting on the plan. The venue and the date of the meeting will be communicated once decided.
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