Hambantota Refinery Explained
The Hambantota Refinery (also called Greenfield Oil Refinery)[1] is an oil refinery to be developed in Mirijjawila, Hambantota, in the Southern Province of Sri Lanka. The 585acres refinery will be built and owned by Singapore's (70%) and Oman's Ministry of Oil and Gas (30%). Silver Park International is an investment vehicle owned by India's Accord Group.[2] It will have a refining capacity of 200000oilbbl per stream day, ten times the capacity of the Sapugaskanda Refinery, the country's only other refinery which was built in 1969 by Iran.[3] [4]
At a cost of, the refinery development is the single largest foreign direct investment in Sri Lanka's history. Construction of the first phase will commence on 24 March 2019 at a groundbreaking ceremony in the Mirijjawila Export Processing Zone, with Prime Minister Ranil Wickremesinghe attending as chief guest, with the project slated for completion in 44 months.
Almost the entire output from the refinery will be exported, generating an estimated annual revenue of . However, CEYPETCO and Lanka IOC could bid for refined petroleum products at competitive prices to supply to local consumers.
Storage and export
Under construction first phase, will be assigned to construct the oil terminal, pipeline, and other infrastructure. The oil terminal will be able to store 1000000MT of crude oil, and around 700000MT of refined petroleum products.
Exports from the refinery will be channelled through the now Chinese-owned Hambantota Port, which has been mostly idle for nearly a decade since being built. The port, initially state-owned, has been leased to China in 2017 for 99 years, after Sri Lanka was unable to service a loan from Beijing.[5]
History
- Before 2017, a 100000oilbbl per stream day refinery was agreed to be built at Trincomalee by Indian Oil Corporation,[6] although no progress has been made since.[7]
- In September 2017, Sri Lanka engaged in talks with two Chinese companies for a $3 billion refinery in Hambantota.[8]
- During President Maithripala Sirisena's official visit to Tehran, cabinet spokesman Rajitha Senaratne stated that Iran has agreed to build a refinery and will send a team for assessments.
- 19 March 2019, Sri Lanka confirms refinery with Singapore's and Oman's Ministry of Oil and Gas.
- 21 March 2019, Oman denies ever being aware of the refinery deal. Director General of Sri Lanka's state-run Board of Investment, Champika Malalgoda, then stated that the project would still go ahead, although without clarification on this situation or how the missing investment would be covered.[9]
See also
Notes and References
- News: Sri Lanka discusses partnership modalities for proposed Oil Refinery with Oman . 20 May 2019 . . 8 May 2019.
- News: Sri Lanka wins record foreign investment in oil project . 20 March 2019 . . 20 March 2019.
- News: Fernando . Nishel . SL eyes largest ever FDI with US $ 3.85bn refinery in H’tota . 20 March 2019 . . 20 March 2019.
- News: Aneez . Shihar . Sirilal . Ranga . Indian-Omani group strikes $3.85 billion deal to build Sri Lanka oil refinery . 21 March 2019 . . 19 March 2019.
- News: Sri Lanka wins record foreign investment in oil project . 20 March 2019 . . 20 March 2019.
- News: Aneez . Shihar . Sri Lanka in talks with two Chinese firms for $3 billion refinery . 21 March 2019 . 22 September 2017.
- News: Aneez . Shihar . Iran agrees to build new refinery for Sri Lanka -govt spokesman . 21 March 2019 . . 16 May 2018.
- News: Aneez . Shihar . Sri Lanka in talks with two Chinese firms for $3 billion refinery . 21 March 2019 . 22 September 2017.
- News: Aneez . Shihar . Oman denies it has agreed to invest in Sri Lanka oil refinery project . 21 March 2019 . . 20 March 2019.
