Asian Development Bank to fund feasibility study of setting up LNG terminal in Sri Lanka
The Asian Development Bank (ADB) has decided to reportedly fund a study on the feasibility of setting up a liquefied natural gas (LNG) terminal in Sri Lanka to supply the country’s own power plants as well as to ship fuel to the Maldives.
The project, which was approved in response to a request by Sri Lanka in March 2019, is to include a feasibility study to identify the optimal LNG facility and site, and surveys and hydrodynamic studies and also assess the state owned power utility, the Ceylon Electricity Board’s technical and procurement capacity for LNG.
“Maldives is considering importing LNG for power generation and other uses,” the ADB has stated.
“LNG terminal in Sri Lanka with sufficient storage and adequate supply will benefit from lowering the energy cost of both countries.”
Accordingly, the feasibility study will look at the demand for natural gas in Sri Lanka, global LNG market, LNG pricing and contracts, possibility of supplying LNG to regional markets, and other social and environmental aspects.
The proposed feasibility study is expected to identify whether a land-based LNG terminal or floating storage and regasification unit would be optimal for Sri Lanka and the most suitable location for new LNG-fired power plants and associated facilities.
According to reports, the ADB aid, in the form of a grant, comes in response to a Sri Lankan government request to ADB in March 2019 to support the Ceylon Electricity Board urgently in exploring LNG as a fuel for power generation.
OSL take:
The move by the ADB to fund a feasibility study for a LNG terminal in Sri Lanka indicates the support received by the government of Sri Lanka for its development agenda. The government is currently looking for renewable energy solutions to address the power crisis faced by the country. There are many business/investment opportunities in Sri Lanka’s power sector for interested foreign companies.
| Article Code : | VBS/AT/13062019/Z_5 |