ONGC Videsh Limited (OVL) is keen to participate in oil and gas exploration opportunities in Sri Lanka and is waiting for the island nation to unveil its roadmap and policy on developing the upstream petroleum industry, the company’s managing director Rajarshi Gupta told reporters on Wednesday. OVL is the overseas investment arm of India’s state-owned Oil and Natural Gas Corporation. According to Gupta, a presence in oil and gas assets in Sri Lanka would gain from the synergies of the larger ONGC group, as the parent company has significant upstream assets and infrastructure in southern India. Geologically, the island nation and its offshore areas are quite similar to parts of southern India, and the ONGC is experienced in operating in such zones. Sri Lanka’s geographical proximity to India is also seen as a major attraction for OVL. Gupta added that OVL would be open to government-government negotiations, competitive bidding or any other route that the Sri Lankan government decides on to enable participation in the island country’s upstream petroleum sector. Asked by when he expects Sri Lanka to open up oil and gas exploration to foreign participation, Gupta said that it would be contingent on the Sri Lankan government finalising its policy for the sector. In January, Reuters reported that Sri Lanka was in the process of preparing a policy to issue exploration licences for up to 900 offshore blocks in a bid to attract foreign investment. The island nation had been struggling with a severe economic crisis, which led to an associated energy crisis as well. Sri Lanka is largely dependent on imports to meet its domestic fuel demand. India already has close energy ties with its southern neighbour and the Indian Oil Corporation is among the major fuel retailers in Sri Lanka. So far, Sri Lanka has not gone ahead with a major petroleum exploration programme. It held a very small licensing round for oil and gas exploration back in 2007, which resulted in just one block being awarded. Based on seismic data, the Sri Lankan government reportedly estimates that a 30,000 sq km area off the island’s north coast holds oil resources of over a million barrels.
