The South Asian island nation of Sri Lanka depends on expensive imported coal and liquids fuel for power generation and has yet to include natural gas in its energy mix. The Sri Lankan Civil War restricted oil and gas exploration for more than 25 years, until Cairn India resumed exploration drilling in 2011.
Creating domestic demand is necessary before Sri Lanka can attract investors and start producing its own gas, and the government is keen to fast-track 1,000 MW of gas-fired power generating capacity within the next three years.
Sri Lanka aims to be energy self-sufficient by 2030, meeting demand from renewable energy sources and potentially from yet to be discovered domestic gas resources, but imported LNG is, for now, the only way of introducing natural gas to the country.
Companies from India, Japan and China have each thrown their hats in the ring, hoping to develop Sri Lanka’s first LNG terminal. Four power plants, to be fuelled by regasified LNG, are on the drawing board, albeit in different stages of progress.