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Thursday December 1st, 2022

China MCC in talks with Sri Lanka over US$310mn mineral sand venture

ECONOMYNEXT – China Metallurgical Group Corporation (MCC) is in talks with Sri Lanka over a 310 million US dollar mineral sand project, Sri Lanka’s embassy in Beijing said.

Wang Zhou, Managing Director, China Metallurgical Group Corporation (MCC) International and MCC Sri Lanka had met Ambassador Palitha Kohona for talks on February 26, the embassy said.

The mineral sands project could be worth 310 million dollars, the embassy said, without elaborating.

Sri Lanka has several sea sand deposits in the Northwest of the island such as in Pulmoddai which get replenished over wave action. Now a state-run corporation exports raw sand.

Sri Lanka’s mneral sands include monazite and zircon which are believed to contain rare earth elements (REEs) such as cerium.

‘Rare’ earth elements may not actually be rare but up to now only a few countries had been producing them. REE use has been expanding in new technology areas such as renewable energy and electronics.

China is a leading producer of rare earth elements, and nobody bothered much about them until the country started placing export restrictions, which led to a rush to develop new sources.

MCC’s construction units had built in infrastructure in Sri Lanka and the firm has had a presence in the island for many years.

Ambassador Kohona had also invited MCC to invest in Colombo Port City, a sea reclamation project by China Harbhour Engineering, for which the government is giving attractive incentives.

Colombo Port City has put the put the first set of land for sale. (Colombo/Feb27/2021)

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  1. Shyam Gunadheera says:

    Another natural asset of Sri Lanka to be sold to China.

    Pulmoddai is famous for its Zircon and Rutile deposits. These minerals are used in spacecrafts coating we are told.

    God help Mineral Sands Corporation.

    1. Leo says:

      We are “selling” them anyway, in raw form in insignificant amounts. Why not invite companies here who can create products out of them and then sell them?

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Comments (2)

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Your email address will not be published. Required fields are marked *

  1. Shyam Gunadheera says:

    Another natural asset of Sri Lanka to be sold to China.

    Pulmoddai is famous for its Zircon and Rutile deposits. These minerals are used in spacecrafts coating we are told.

    God help Mineral Sands Corporation.

    1. Leo says:

      We are “selling” them anyway, in raw form in insignificant amounts. Why not invite companies here who can create products out of them and then sell them?

Sri Lanka China-backed port to welcome second cruise ship

ECONOMYNEXT – Sri Lanka’s China-backed Hambantota Port said it was getting ready to welcome MV Azamara Quest, a cruise ship, as another passenger vessel departed.

Mein Schiff 5, operated by TUI had departed Hambantota International Port for Pulau Penang Island, Malaysia on November.

“As well as being her maiden call at the port, Mein Schiff 5 is the first passenger cruise ship to call at the port since the pandemic began,” said Johnson Liu, CEO of Hambantota International Port Group (HIPG) said in a statement.

“It was undoubtedly a great boost for the tourist economy in the south when the vessel called at the Hambantota International Port.”

Mein Schiff 5’s passengers had also visited the Bundala National Park, Hambantota Botanical Gardens, Galle and Kataragama.

Passengers had explored Hambantota by tuk-tuk, while others had enjoyed the beaches in the Shangri La Hotel, the port said.

MV Azamara Quest will arrive in Hambanota on on December 05. (Colombo/Dec01/2022)

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Sri Lanka’s shares gain in mid market trade

EXONOMYNEXT- Sri Lanka’s shares gained in mid market trade on Thursday (1), pushed up by strong positive sentiments on interest rates easing in line with inflation and speculation on government to hold talks with multilateral creditors ADB and World Bank for a possible loan facility.

Market has continued to gain for the past four sessions.

“Shares were moving on positive strong sentiments flowing in from yesterday (30), we are seeing a rally in the hotels, while the retail favorites such as LIOC and Expolanka,” analysts said.

Positive investor sentiments have been established, from positive comments from the Governor of the Central Bank over market rates eventually seeing an ease despite the fears of a domestic debt restructuring as inflation falls, increased liquidity in dollar markets, and the inter-bank liquidity improves.

Analysts further stated that, Treasury related stocks are also activated due to downward movements in yield.

All Share Price Index (ASPI) gained by 1.4 percent or 123.41 points to 8,774.64, while the most liquid share gained by 1.31% or 35.68 points to 2,765.

The market generated a turnover of 1.6 billion rupees at 1130 hours. (Colombo/Dec1/2022)

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Sri Lanka electricity losses from overpriced fuel, no tariff hike considered: regulator

ECONOMYNEXT – Sri Lanka’s state-run Ceylon Electricity Board’s high operating costs are partly due to excessive prices paid for fuel and no tariff hike is being considered, Chairman of the Public Utilities Commission of Sri Lanka, Janaka Ratnayake said.

The CEB itself does not buy fuel but depends on state-run Ceylon Petroleum Corporation and Lanka Coal, another state firm to buy fuel. Both firms are periodically caught in procurement scandals.

“They are paying about 385 plus rupees per litre for furnace oil,” Ratnayaka told EconomyNext.

“That is too much. From the global market we can buy it to much lower price. It can be imported below 200 rupees,”

“I ask the government to take the necessary steps to create a system to import furnace oil, like they did for fuel, to be imported at the lower price levels. If that happens, we can go without going for a price hike.”

Sri Lanka’s CEB generally gets furnace oil and residual oil from the domestic refinery and usually do not import furnace oil.

The refinery however is not regularly operating due to inability to get crude amidst the worst currency crisis in the history of the island’s intermediate regime central bank.

Ratnayake had earlier brought to light import costs of the CPC.

Pushing for operations efficiency of the CEB is a role of the regulator. Regulating costs based on global benchmark prices to push for procurement efficiencies is a standard practice. However the PUCSL is not the official regulator of the petroleum sector.

Related

Sri Lanka power tariff revisions sought in Jan and July: Minister

Power and Energy Minister Kanchana Wijesekera told parliament that cabinet approval was sought to twice yearly tariff hikes in January and July of each year.

No Electricity tariff hikes are being considered yet, Ratnayake said.

Wijesekera blamed the regulator as well as successive administrations for not regularly revising power prices and pushing the sector into crisis.

In Sri Lanka activists had also blocked cheap coal power. (Colombo/Dec01/2022)

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