MUSCAT: Oman Oil Company is conducting a feasibility study regarding taking a 30 percent stake in a new oil refinery project on Sri Lanka’s south coast, the Sultanate’s Minister of Oil and Gas has said.
Talking to Oman News Agency, Dr Mohammed bin Hamad Al Rumhy, Minister of Oil and Gas, said Oman is considering the feasibility of taking 30 percent share of the oil refinery in Lanka’s South coast.
The $3.85 billion refinery project is Sri Lanka’s first new refinery in 52 years after Iran built a 50,000 barrel-per-day refinery near the capital, Colombo, to blend Iran light oils.
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Last week, Rumhy joined Sri Lankan Prime Minister Ranil Wickremesinghe in laying the foundation stone for the oil refinery project.
Attending the stone laying ceremony, Rumhy said that he was excited to be part of the oil refinery project in a sign that plans for the Oman’ involvement may be back on track.
Earlier, Sri Lanka had said last Oman Oil Co had made clear it was interested in taking a 30 percent stake in the new refinery on Sri Lanka’s south coast, however, an Omani official denied Oman had agreed to invest in the project.
On March 19, Sri Lankan officials had told a news conference that a joint venture between the Oman oil ministry and a Singapore investment vehicle owned by India’s Accord Group had agreed to build the 200,000 barrel per day refinery near Chinese-controlled Hambantota port in Lanka.
The Oman ministry was to take a 30 percent stake, the officials said, representing what would be Sri Lanka’s biggest single foreign direct investment.
However, Salim al-Aufi, undersecretary of Oman’s ministry of oil and gas, told a news conference on March 20 in Oman, no one on Oman side of the panel was aware of this investment in Sri Lanka.
“It came as news to me, I don’t know who is signing the cheque for $3.8 billion,” the official had said.
Any big deal in Sri Lanka involving Indian investment will pose a challenge to China, which had until recently been on track to be the dominant foreign investor on the island.
India has become concerned in recent years about China muscling into Sri Lanka and other countries in a region where India is the traditional power.
China is the biggest buyer of Omani oil, importing about 80 percent of the Middle Eastern nation’s overall crude exports in January, according to an Oman government website.
( With inputs from agencies )
