Sri Lankan government re-opens tenders for off-shore block in the Mannar Basin to explore fossil fuel
The Petroleum Resources Development Secretariat (PRDS) of Sri Lanka has reportedly reopened tenders for the M2 off-shore block in the Mannar Basin for fossil fuel development and discovery in January.
According to reports, the M2 block has two discovered natural gas wells ‘Dorado’ and ‘Barracuda’ and further drilling prospects.
“Bidders are expected to consider both development of the discoveries and the exploration of the rest of the M2 block,” PRDS has said in its request for bids announcement.
Bids will close on May 7, 2019.
The local media has reported that two wells in the M2 block were discovered by Indian oil firm Cairn in 2011, when it made four drillings at a cost of 240 million US dollars, after winning a bidding round in 2007.
The PRDS has stated that the two wells are estimated to have two trillion cubic feet of natural gas and 10 million barrels of condensate.
Following government inquiries in 2017 and 2018, 12 international petroleum companies had shown interest in the two wells.
According to the PRDS, the nine blocks in the Mannar Basin alone could have the potential of an additional 5 billion barrels of oil and 9 trillion cubic feet of natural gas which would be sufficient for Sri Lanka’s energy needs for the next 60 years.
The local media has meanwhile stated that bids for the other eight blocks in the North Western and Western Mannar Basin and five blocks in the Northern Cauvery Basin are also expected to be open soon.
Meanwhile, the Sri Lankan government and France’s Total have launched a joint study for blocks off the country’s east coast.
OSL take:
The re-opening of tenders for two wells in one block of Sri Lanka’s Mannar Basin for oil exploration is an ideal investment opportunity for foreign energy companies. The Sri Lankan government is looking at calling for bids for the other eight blocks in the Mannar Basin as well. At a time when many the output of many fossil fuel reserves are on the decline, the wells in Sri Lanka’s Mannar and Cauvery Basins offer a lucrative investment with very high returns on investment.
| Article Code : | VBS/AT/18012019/Z_4 |