By Asiri Fernando in The Morning online, July15, 2023
The Government will appoint a committee to evaluate the proposal submitted by the Indian Oil Corporation (IOC) for an oil distribution pipeline connecting Nagapattinam, Tamil Nadu to Trincomalee and Colombo, the Ministry of Power and Energy said yesterday (15).
The proposal comes days before President Ranil Wickremesinghe is to visit New Delhi on the invitation of Indian Premier Narendra Modi.
According to the Ministry of Power and Energy Secretary M.P.D.U.K. Mapa Pathirana, the committee will be appointed soon.
“We have only received this recently and a committee will be appointed soon to evaluate it. We will need expert help to analyse this proposal,” Pathirana said.
A senior Government official close to the subject said that the composition of the committee would likely be decided following a discussion between the Ministry of Power and Energy and the President’s Secretariat.
According to him, the IOC is keen to establish a pipeline to Sri Lanka which will link domestic storage potential to the new nine million metric tonnes per annum (MMTPA) refinery at Nagapattinam, established through a joint venture by Chennai Petroleum Corporation Ltd. (CPCL) and IOC.
The senior official opined that the pipeline may be a more economical option for the IOC to establish than constructing a new refinery in Trincomalee Bay. IOC already manages several long-distance oil pipelines in India.
Last week, Minister of Power and Energy Kanchana Wijesekera took to Twitter to announce that the IOC proposal had been discussed.
“A proposal by IOC for an oil distribution pipeline connecting Nagapattinam, Trincomalee, and Colombo was discussed yesterday. I requested them to look at a two-way oil and gas pipeline taking into consideration the Government’s development plan for Trinco Tank Farm and energy hub, future developments of refineries, oil and gas exploration, pipeline connections to domestic LPG terminals that will target regional oil and gas export markets while enabling energy requirements of both countries.
Project feasibility, technical requirements will be assessed before finalisation of the project scope for approval. Officials of Indian High Commision, Ministry of Power and Energy, CPC, CPSTL, PDASL, IOC and LIOC participated,” Wijesekera tweeted.
Earlier, State-owned Ceylon Petroleum Corporation (CPC) and Lanka Indian Oil Company (LIOC), a subsidiary of IOC, signed an agreement to jointly develop the 1930s-era Trincomalee Oil Tank Farm which had been neglected over the decades.
The move drew criticism from some Opposition parties and trade unions which objected to ‘national assets’ being sold off to foreign companies. However, according to the CPC, LIOC has pledged close to $ 180 million to rehabilitate the oil tank farm and bring it back into operation.
Attempts to contact the LIOC regarding the IOC proposal failed.
https://www.themorning.lk/articles/5Gw2oJZUHufwX7WmtYOr
