Cairn to start drilling for oil in Sri Lanka in July

Cairn India, a unit of British exploration firm Cairn Energy plc, said today it plans to drill for oil and natural gas deposits off Sri Lanka`s northwestern coast in July.

Last Updated: Mar 12, 2011, 14:49 PM IST

Colombo: Cairn India, a unit of British
exploration firm Cairn Energy plc, said today it plans to
drill for oil and natural gas deposits off Sri Lanka`s
northwestern coast in July.

In 2008, Cain invested USD 100 million, spread over three
years, to conduct detailed seismic studies and drilling three
wells off the coast of Mannar.

"Frontier exploration drilling in Sri Lanka is planned to
commence in July," a company statement said.

"Logistical preparations and detailed studies are ongoing
ahead of drilling later this year."

Sri Lanka, which imports all of its oil needs, offered
three blocks to investors after surveys showed deposits along
the Gulf of Mannar, close to neighbouring India.

Block two, an area that covers around 3,400 square
kilometres (1,300 square miles) off Mannar, was offered to
Cairn in June 2008.

Sri Lanka allocated the two other blocks to the
governments of India and China.

The island spent USD 3.0 billion in 2010 importing oil,
which was 40 per cent more than 2009, according to central
bank figures.

Decades ago, overseas companies explored areas off Sri
Lanka`s northwest coast, but failed to find any oil and gas
reserves worth exploiting commercially.

PTI