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Sri Lankan government discusses India’s proposal for multi-product oil pipeline

Sri Lankan government discusses India’s proposal for multi-product oil pipeline

Ada Derana: The Indian government has submitted a proposal through the Indian Oil Corporation (IOC) Ltd. for a multimodal oil pipeline connecting Nagapattinam in India, and Trincomalee Oil Tank Farm and Colombo in Sri Lanka.
Commenting on this matter, Kanchana Wijesekera, the Minister of Power and Energy, said that a discussion on the proposal was held with the Indian Oil Company on February 7, coinciding with the Indian Energy Week.
The chairpersons of Indian Oil Corporation (IOC), Lanka IOC, Ceylon Petroleum Corporation (CPC), and Petroleum Development Authority of Sri Lanka (PDASL) have joined the interaction.
Technical studies, demand market analysis, financial analysis, and business models are to be conducted to determine the mechanism involved.
Regarding this discussion, the Minister further mentioned that they also discussed the investments and expansion of projects under the joint venture of the Oil Tank Farm in Trincomalee, Ceylon Petroleum Storage Terminals Limited (CPSTL), and Lanka IOC retail operations.

OSL take:
Sri Lanka’s energy industry has become one of the fastest growing industries in the country following the Sri Lankan government’s decision to open up the country’s retail fuel market. So far three new foreign players have received the green light to engage in the local fuel market. Apart from this move, Sri Lanka has also presented several more business/investment opportunities in the fuel industry that range from the refurbishment of the oil tanks in Trincomalee to oil exploration in the Mannar Basin. With Sri Lanka’s economic activities on a growth path and the country working towards becoming an emerging business destination in the South Asian region, the country’s power and energy industries are likely to see a further expansion. The growing business potential in Sri Lanka’s energy industry therefore presents lucrative business/investment opportunities that guarantee quick returns on investment. Given the successful expansion of businesses engaged in the local energy industry, foreign businesses could also look at forming partnerships or joint ventures with local businesses engaged in the industry in order to push further expansion.

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Article Code : VBS/AT/20240221/Z_7

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