Govt. to initiate steps for offshore petroleum exploration
Posted on March 17th, 2025

Courtesy The Daily Mirror

Colombo, March 18 (Daily Mirror) – The government is to undertake offshore gas exploration after the selection of a consultant firm to handle the international tender process in this regard, an official said yesterday.

In Sri Lanka, a national policy on natural gas was gazetted in September 2020, outlining domestic demand creation strategies and providing operators with options to commercialise offshore gas. A new Petroleum Resources Act No. 21 of 2021 has also been introduced to regulate the process.

The Petroleum Development Authority of Sri Lanka (PDASL) has also been established as the independent upstream regulator.

Offshore Sri Lanka consists of four sub-basins: Cauvery, Mannar, South Lanka, and East Lanka. Past discoveries have proven the petroleum system in the Mannar basin, according to PDASL.

Chairman of the Ceylon Petroleum Corporation (CPC) D.A. Rajakaruna told Daily Mirror that the government would call for tenders after the budget debate to select a consultant firm to be assigned for international tender calling to develop the upstream petroleum industry in Sri Lanka.

In 2011, Cairn Lanka Private Limited’s Dorado well made the first discovery of natural gas in Sri Lanka, followed by the Barracuda natural gas discovery, and proving a productive petroleum system in the Upper Cretaceous section of the northern Mannar Basin. Cairn departed the undeveloped fields in 2015 stating that the fields would not be commercial, a decision made when the average international oil prices were below US $ 40.

PDASL has the authority to prepare a map dividing offshore and onshore areas into sections to demarcate and designate exploration blocks and development blocks. It can market and promote blocks.

The Act says, The ownership of all petroleum data obtained or prepared in pursuant to any petroleum operation in Sri Lanka shall be vested in the State and the management and control of such petroleum data shall be vested with the Authority. The Authority may issue a licence permitting access to the petroleum data for the commercial, educational or scientific use by any person subject to the procedure and the fees as may be prescribed.”

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