Govt support encouraging:

Sri Lanka should strike oil soon

Cairn Lanka completing detailed study:

Sanjeevi JAYASURIYA

It is expected that Sri Lanka will strike oil in the near future as Cairn Lanka (Pvt) Limited is in the process of completing the detailed study to facilitate its efforts, a senior official from Cairn India said.

“The support given by the Government in this endeavour is very encouraging. We received its fullest cooperation and we are happy with the progress,” he said.

The Government of Sri Lanka and Cairn India signed the Petroleum Resource Agreement (PRA) for the exploration licence for oil and natural gases in the Mannar Basin on July 7, 2008.

The Board of Investment and Cairn Lanka (Pvt) Limited subsequently entered into an agreement on September 10, 2008, committing an initial investment of more than $110 million towards the exploration of hydrocarbons. Cairn Lanka will be the only player in Sri Lanka in the event of oil exploration.

The oil exploration is based on past studies and also fresh studies conducted by Cairn and the Block SL 2007-01-001 which is offshore North West Sri Lanka and covers approximately 3,000 km in water depths of 200 metres to 1,800 metres was awarded to the company.

The work program includes proposals to acquire 5,000 kilometres of 2D, 1,000 km of 3D seismic and drill three wells in the initial three years of the eight-year exploration period.

“Once we have completed the studies we will drill the wells. It is difficult to say exactly the timeframe, but by the end of this year or early next year we hope to complete our studies”, he said.

It is only when we drill the wells that we could say what we could expect whether it is oil or gas. It is like fighting nature. We are guiding nature to come out. This is a risk taking business, he said.

According to the study conducted, the topography features indicate that there could be oil in the area. “We need to carry out a step way process and there are no short cuts. It is a long process and a complicated job.

It got a particular floor that we have to follow. Nothing can be skipped and no time limit could be set”, he said.

Cairn Lanka (Pvt) Ltd, is a wholly owned subsidiary of Cairn India.