Offshore oil: Lanka to exclude political firms

International companies and their “key shareholders” who have “known alignment in world politics” will not be considered when offers are invited to assess Sri Lanka’s offshore petroleum data, the Cabinet has decided.

It came on a recommendation made by President Mahinda Rajapaksa. The Petroleum Resources Development Secretariat (PRDS) comes within his purview. The Cabinet has also decided that these companies should not in any way impair Sri Lanka’s national interest.

The decisions came after the Government ran into trouble with the Norway-based firm TGS Nopec to acquire process and analyse Sri Lanka’s offshore petro- leum data. The company was given the tasks in 2001 and 2005 but the Government was not happy with its performance. The company provides global geoscientific data, products and services to the oil and gas industry to assist with licensing and the preparation of regional data programmes.

A Cabinet decision was made to disengage from the TGS Nopec agreement. However, it was pointed out by the Treasury that it would entail payments of large sums of money and delays in Sri Lanka obtaining the data.

President Rajapaksa observed in a memorandum to the ministers that “since an agreement with an individual company had proved issues in the past, the Government should where possible, seek to enter into multi-client agreements with countries instead. Here, the PRDS team clarified that while State-owned operating companies exist who could partner Sri Lanka in drilling and production, multi-client data acquisition was a business model exclusive to a very few global service companies, none of which were State owned…”

President Rajapaksa also recommended to the Cabinet that “all multi-client agreements entered into by the Government of Sri Lanka should be with international service companies of high repute with a proven track record in the sector.”