Sri Lanka natural gas find not seen meeting LPG needs

COLOMBO, Oct 01, 2014 (EconomyNext) – Natural gas found in Sri Lanka’s offshore Mannar Basin  is methane-rich and not likely to have much of an impact on the island’s liquid petroleum gas (LPG) requirements, a senior official said.

"Mannar Basin gas is 93-95 percent methane with only traces of propane and butane," Saliya Wickramasuriya, Director General of the Petroleum Resources Petroleum Resources said.

"So Sri Lanka’s domestic gas production will not have much impact on the country’s LPG requirements," he told a forum organised by the National Chamber of Commerce on investment opportunities for the private sector in the island’s emerging petroleum industry.

Sri Lanka imports most of its LPG requirements with a small proportion supplied by the sole oil refinery of the state-owned Ceylon Petroleum Corporation to the two gas suppliers, Lithro Gas, also government owned, and the listed Laugfs Gas.

Wickramasuriya explained that the heavier propane and butane are easy to liquefy and compress to make it transportable for requirements like LPG.

"But you can’t with methane which is lighter than air and difficult to compress, as it needs a lot of energy, and cool to minus 160 degrees to be liquid."

Cairn India has struck natural gas in two well drilled in the Mannar Basin off the west coast and is negotiating with the government on price before starting commercial production.

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