Sri Lankan government has received several
proposals to develop natural gas found in the block M2 of the Mannar basin in
the Bay of Bengal adjoining the Tamil areas of the island and a contract would
probably be signed at the end of this year, according to an official of the,
Director Benefits at the Petroleum Resources Development Secretariat, the Sri
Lankan media reported.
Studies conducted so far had shown that there was
a potential reservoir capacity in excess of one trillion cubic feet in two
sites, Dorado and Barracuda, of the M2 Block, he said.
"Of the two discoveries, 300 billion cubic
feet of natural gas is situated within the smaller, simpler, Dorado reservoir,
which lends itself to early production after appraisal. The larger Barracuda
discovery that is in excess of 500 billion cubic feet needs further appraisal
built with extensive reservoir studies and evaluation for optimal production
The spokesman said that the Ceylon Electricity
Board (CEB) is planning to set up a 600 MW power plant to run on natural gas
and if that works out they can pump this directly into the systems and generate
power. The extraction project would take
at least three years to fructify.
Once Sri Lanka was able to secure natural gas
from the Mannar basin situated near Rameshwaram , it would be the most cost
effective and secure source of energy for Sri Lanka.
"Our plan is to have a balanced energy mix.
We want to generate around 20% of energy using natural gas in the next 20
years. That is why we have put some emphasis on the building natural gas power
Last week CEB Engineers Union (CEBEU) said a
powerful UNP Minister was pressuring the government to sign an agreement with
private investors from Japan and India to build an LNG terminal and to purchase
2.7 million tons of liquid gas per year, for a period of 20 years. The project
the union contended would be 1,000 times worse than the disastrous hedging
agreement signed by the Rajapaksa administration with Chinese entities.
"If we are going to extract natural gas from
Mannar in a few years why are we signing a deal to purchase LNG from India and
Japan?" the union spokesman said.