Sri Lanka receives investment proposal to set up US$ 24 billion petroleum refinery for export markets
The Board of Investment (BOI) of Sri Lanka has reportedly received an investment proposal is to set up a petroleum refinery with a 420,000 barrels/day capacity for export markets at Hambantota.
The proposed project which amounts to approximately US$ 24 billion, over a period of 60 months, is by far the largest Foreign Direct Investment (FDI) project received by the BOI to date.
According to the local media, Sri Lanka’s geographical locational advantage between Singapore and the Middle East, and the availability of a new deep-water Port in Hambantota has made the island an optimum location for establishing export-oriented petroleum and other commodity processing facilities.
Promoting the country’s prospects as an investment destination against this backdrop, the BOI’s efforts have reportedly resulted in an investment proposal from Hambantota Oil Refinery Ltd., an affiliate company to Sugih Energy International Ltd., which is a privately-owned petroleum and coal trading company based in Singapore.
Accordingly, the initial phase is to involve the commissioning of the petroleum refinery with plans for development of a petrochemical complex in subsequent phases. Export revenue envisaged upon commissioning of the refinery is expected to be around US$ $ 8-9 billion annually.
The BOI after approving the project in principle in July last year has utilised the time period afterwards to obtain concurrence and approvals of all relevant agencies and organizations of the Sri Lankan government including the Cabinet of Ministers.
With the BOI Agreement now signed, the immediate next step is a comprehensive Environmental Impact Assessment (EIA) compliant with the Terms of Reference already issued by the Central Environment Authority (CEA) and other regulatory bodies, to be conducted prior to implementation of the project, local media reports stated.
Also, the refinery has projected demand for employment ranging from medium to high-end skill levels (operators, technicians, graduates, engineers, chemists, etc.) with direct employment opportunities for almost 6,500 Sri Lankans while creating further indirect employment opportunities in support services.
OSL take:
The aggressive development programme that covers all key economic sectors islandwide launched by the government of Sri Lanka has seen the expansion of business/investment opportunities in the island. Sri Lanka’s Hambantota Port along with its industrial zone have created many business opportunities for foreign businesses/investors.
| Article Code : | VBS/AT/20191119/Z_2 |