India's state-owned Oil and Natural Gas Corporation has revived its interest in oil exploration in an oil and gas block in Mannar basin after the Sri Lankan government agreed to renegotiate terms and conditions it had offered to them earlier.
Minister of Petroleum and Petroleum resources Development A.H.M. Fowzie told The Sunday Times FT that a team of ONGC officials will arrive in the island this month to confirm their decision after negotiations on the signature bonus payment with Sri Lankan authorities. Meanwhile Iran has agreed to provide free technical knowhow for Sri Lanka’s oil exploration activities, he said.
Sri Lanka last year offered Block 1 to ONGC Videsh Ltd, the overseas investment arm of the Indian state-run firm, on a nomination basis if it paid a signature bonus of $10 million. But the company refused as it found the amount to be too high when compared with the prospects of the block.
Fowzie said Cairn from India and Niko Resources of Canada have also submitted bids for another block in the same area. Cairn already has an agreement with the government on oil exploration.
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