Natural gas fund proposed for Sri Lankan hydrocarbon deposit earnings
ECONOMYNEXT – Sri Lanka should set up a natural gas fund to manage the revenue expected from offshore hydrocarbon deposits once they begin to be commercially exploited, a senior industry official said.
Demand for natural gas is rising globally and Sri Lanka could use the deposits found in the Mannar Basin to initially run power plants, said Preeni Withanage, Director Benefits of the Petroleum Resources Development Secretariat, (PRDS), responsible for exploration.
Of the two discoveries made by Cairn Lanka, the Dorado well was marginal but the Barracuda well was large with up to five trillion cubic feet of natural gas, although it was technically complex and more studies are needed to know recoverable quantities, she said.
Government policy was one of the key factors governing the reserves commercialization process, she told a public forum on the new draft policy on natural gas held by the Public Utilities Commission of Sri Lanka, the energy regulator.
“There should be a mechanism for the sound management of the natural gas revenue – we propose a natural gas fund,” Withanage said.
That would be similar to mechanisms set up by other countries to manage hydrocarbon earnings, the most well-known being Norway’s trillion dollar sovereign wealth fund, the world’s largest sovereign wealth fund.
(COLOMBO, March 29, 2019-SB)