Four offshore blocks covering nearly 34,000 sq km, two previous discoveries, estimated reservoir capacities exceeding one trillion cubic feet (TCF) of natural gas and 10 million barrels of condensate, and more than four decades of seismic and drilling information are among the assets Sri Lanka is putting before international energy companies in its latest attempt to unlock the petroleum potential of the Mannar Basin.

Unlike when Sri Lanka first ventured into offshore petroleum exploration several decades ago, the question today is no longer simply whether hydrocarbons could exist beneath its waters.

Previous exploration and drilling in the Mannar Basin have demonstrated the presence of a working petroleum system and resulted in natural gas discoveries. Yet, despite the accumulation of geological evidence and several attempts to attract international companies, Sri Lanka has never progressed to commercial oil or gas production.

The latest effort is therefore testing a different question: whether the data accumulated over decades, combined with previously confirmed discoveries and changing global demand for natural gas, can finally provide international energy companies with a sufficiently attractive case to invest and drill.

34,000 sq km back on the table

The Government, through the Petroleum Development Authority of Sri Lanka (PDASL), formally launched the Sri Lanka Licensing Round 2026 (SL2026-01) on 25 August, offering four offshore exploration blocks in the Mannar Basin to qualified international energy companies.

Together, the blocks cover almost 34,000 sq km of offshore acreage.

The Mannar Basin is regarded as Sri Lanka’s most established offshore petroleum basin, largely because previous exploration has already demonstrated a working petroleum system. The licensing round therefore does not offer investors an entirely unknown geological frontier.

Ceylon Petroleum Corporation (CPC) Managing Director Dr. Mayura Neththikumarage told The Sunday Morning that one advantage of the latest initiative was the availability of information accumulated through previous exploration efforts.

He said that earlier drilling and exploration data had subsequently been subjected to further analysis, resulting in a more comprehensive dataset and plan. That could prove crucial in a sector where deciding whether to drill an offshore exploration well involves substantial financial exposure.

While geological data cannot eliminate exploration risk, a stronger understanding of the basin can help potential operators determine where to focus further studies and whether the prospects justify the cost of drilling.

Reprocessing decades of data

Sri Lanka took a further step towards improving the investment proposition in January this year, months before launching the licensing round.

On 10 January, the country entered into a service agreement with Eastern Echo FZE to reprocess existing data covering the offshore West Mannar Basin. The arrangement involves reprocessing the data, creating ExploreCube products, and marketing and licensing the information.

The significance of the exercise lies in converting information accumulated through previous exploration campaigns into material that can be reassessed by prospective investors using more recent analysis and interpretation.

Sri Lanka’s petroleum exploration history stretches back to the 1960s. Early seismic work was carried out on behalf of the CPC, while further offshore and onshore data were gathered during the 1970s.

The first comprehensive seismic programme in the Mannar Basin followed in 1984 under a tripartite arrangement involving Phoenix Canada Oil Company, Petro-Canada, and the CPC.

Petro-Canada acquired approximately 980 km of two-dimensional seismic data in the basin. However, exploration subsequently came to a halt and remained largely dormant until 2001. That year, the CPC and TGS-NOPEC entered into an agreement to collect another 1,100 km of 2D seismic data in the Mannar Basin.

In 2007, the Government acquired the Mannar Basin 2D dataset from TGS-NOPEC, after which the basin was divided into nine exploration blocks ranging from approximately 3,340 sq km to 6,640 sq km.

Three were subsequently offered for exploration through an international licensing round.

Drilling changed the picture

A more significant turning point came in 2008, when the Government signed a Petroleum Resources Agreement with Cairn Lanka Ltd., a subsidiary of Cairn India.

Unlike seismic surveys, which help identify geological structures and prospective areas beneath the seabed, exploratory drilling provides direct evidence of whether hydrocarbons are actually present.

Cairn’s programme produced Sri Lanka’s most significant petroleum exploration results. The country’s first natural gas discovery was made in the Mannar Basin off the northwestern coast in 2011.

Exploratory drilling eventually resulted in two discoveries from the same block, with estimated reservoir capacities exceeding one TCF of natural gas and around 10 million barrels of condensate.

These discoveries confirmed what decades of seismic work had sought to establish – the existence of an active petroleum system in the Mannar Basin.

However, discovery did not translate into production. Cairn Lanka exited its Sri Lankan operations in 2015 amid the decline in global crude oil prices, leaving the discoveries undeveloped.

Subsequent governments attempted to revive offshore exploration through other international players and licensing initiatives. French energy company Total was brought into offshore exploration efforts during the administration of former President Maithripala Sirisena, while the former Cairn M2 block was later reopened for development and commercialisation.

None of these initiatives ultimately resulted in commercial production.

Gas could change investor equation

The nature of the Mannar discoveries could, however, be more relevant to investors today than during some previous exploration drives.

Dr. Neththikumarage said that earlier exploration initiatives had tended to place greater emphasis on crude oil, while Sri Lanka’s prospective areas appeared to hold greater potential for natural gas. According to him, increasing international interest in natural gas has consequently created a more favourable environment for Sri Lanka to market its offshore potential.

This distinction is significant because the commercial attractiveness of an offshore discovery is determined not only by what is underground, but also by energy demand, prices, development costs, infrastructure, regulatory conditions, and the ability to monetise the resource.

The Government is not expected to bear the exploration and development expenditure under the latest initiative. Instead, selected companies will be required to finance their respective programmes.

Dr. Neththikumarage said that the Government could therefore not estimate at this stage how much investment the licensing round could attract, as the amounts would depend on the work and development plans proposed by participating companies.

The proposals would also be evaluated according to the benefits offered to the Government, including financial commitments such as signature bonuses and guarantees.

From exploration to production

Another element authorities believe distinguishes the current process from some earlier attempts is that it is designed to provide a pathway beyond the initial exploration stage.

Dr. Neththikumarage said that the process would involve three stages – acquisition, development, and production – with successful companies ultimately able to progress towards commercial production.

“Once this project is done, they will have access to commercial production,” he said.

The licensing round has already commenced and is expected to continue into next year, giving prospective companies time to examine the available information and formulate their proposals.

Dr. Neththikumarage further noted that only a limited number of companies worldwide possessed the technical and financial capacity to undertake projects of this nature. However, inquiries have already been received following the initiative, while interest has also been shown by major companies.

He said that the CPC was seeking to maintain transparency by directing interested parties through the formal licensing process. Even after an investor is selected, drilling would not immediately mean production.

The initial period would involve exploration drilling, evaluation, and observation before a discovery could potentially proceed towards development and production.

Asked how long it could take before Sri Lanka saw its first production, Dr. Neththikumarage said that the current expectation was three to five years, although successful exploration could potentially shorten the timeframe.

“We expect it to take three to five years to start the first production,” he said.

The data and the drill will decide

Sri Lanka has been here before: licensing rounds have been launched, international companies have entered, wells have been drilled, discoveries have been announced, and governments have repeatedly spoken of the economic potential beneath the Mannar Basin.

What is different in 2026 is the volume of information now available to prospective investors.

Sri Lanka is offering acreage backed by decades of seismic information, previous exploratory drilling, two discoveries, evidence of a working petroleum system, and data now being reprocessed and marketed specifically to international explorers.

However, the existence of data – even promising data – does not by itself establish whether a petroleum discovery can be developed commercially.

That determination will depend on what prospective companies see in the reprocessed information, the exploration commitments they are prepared to make, the commercial terms offered by Sri Lanka, and ultimately what future drilling establishes beneath the seabed.

After decades spent asking whether the Mannar Basin holds petroleum, Sri Lanka has at least part of the answer.

The question facing Licensing Round 2026 is whether the evidence is strong enough to persuade an international operator to put its capital behind the data – and drill.

Source:The Morning.lk

Construction work on the new Accident and Emergency Care Unit at the Mannar District General Hospital commenced today (16) nder the patronage of President Anura Kumara Dissanayake.

The facility, which will be constructed with a grant of Rs. 600 million provided by the Government of India, is expected to significantly improve access to emergency and specialist healthcare services for the people of Mannar and surrounding areas.

Equipped with modern medical facilities and advanced treatment capabilities, the new Accident and Emergency Care Unit is scheduled for completion during the first quarter of 2028.

Once operational, the facility will enable residents of Mannar to access emergency treatment and a range of specialist healthcare services closer to home, reducing the need to travel to Colombo and other major cities for urgent medical attention.

The project is expected to play a key role in strengthening healthcare services in the rapidly developing Mannar District. In parallel with the construction of the new emergency care facility, the Government has also taken steps to address requirements relating to medical equipment, staffing and other essential resources needed to further develop the Mannar District General Hospital.

Parliamentarian Namal Rajapaksa was today ordered to remain in remand custody until September 23 in connection with a money laundering case filed by the Criminal Investigation Department over alleged financial irregularities linked to the procurement of aircraft for SriLankan Airlines.

Rajapaksa, who is already in remand custody, was produced before the Colombo Fort Magistrate’s Court today, in relation to the case, which has been instituted under money laundering provisions following investigations into Airbus Scandal.

Namal Rajapaksa, the son of Former President Mahinda Rajapaksa, was named as a suspect in the case on September 13 on the instructions of the Attorney General’s Department.

The money laundering investigation comes from allegations of financial irregularities said to have occurred during the procurement of aircraft for SriLankan Airlines, with the Criminal Investigation Department pursuing inquiries into the matter.

The case is separate from proceedings relating to allegations of bribery connected to the Airbus transaction.

Namal Rajapaksa was previously arrested by the Commission to Investigate Allegations of Bribery or Corruption over allegations of accepting bribes in relation to the Airbus deal.

Following his arrest on September 4 and his subsequent production before the Colombo Chief Magistrate’s Court, he had already been remanded until September 18 in that case.

However, when today’s proceedings before the Fort Magistrate focused on the CID’s money laundering case, the court ordered that Rajapaksa be further remanded until September 23.

President Anura Kumara Dissanayake presided over the launch of two major healthcare infrastructure projects today (16) in the Northern and Eastern provinces, marking the start of construction on a new Cardiology Unit at the Trincomalee District General Hospital and an Accident and Emergency Unit at the Mannar District General Hospital.

Both projects, funded through foreign assistance, are aimed at expanding specialised medical care outside the Colombo region and bringing critical treatment services closer to communities that have historically had to travel long distances for such care.

The Trincomalee Cardiology Unit, being built at a cost of Rs. 2,403 million with financial support from the Government of Japan through the Japan International Cooperation Agency (JICA) under the Health and Medical Services Improvement Project, is intended to consolidate comprehensive cardiac diagnosis and treatment services for the people of the Eastern Province at a single facility.

The eight storey building will house modern operating theatres, outpatient services, inpatient treatment facilities and fully equipped laboratories, with construction scheduled for completion by May 2028.

New Accident and Emergency Unit for Mannar

In Mannar, construction has begun on a new Accident and Emergency Unit funded through a Rs. 600 million grant from the Government of India, with the facility expected to be fitted with modern equipment to strengthen emergency and trauma care services in the district.

The project is scheduled for completion in the first quarter of 2028, after which residents of Mannar will be able to access emergency trauma care and other specialised treatment without needing to travel to Colombo or other major cities.

Alongside the construction work, the government has already begun arrangements to provide the hospital with the medical equipment and trained staff needed to operate the new unit effectively.

Hurly-burly was done over the weekend, with the SLPP and the government holding two rallies in Anuradhapura and Polonnaruwa, respectively, but the propaganda brigades of the JVP/NPP and the Opposition are still clashing over crowd sizes. The SLPP and its allies are over the moon about their rally’s impressive turnout. The JVP-NPP social media activists claim that President Anura Kumara Dissanayake’s meeting had a higher crowd density.

The government declared ahead of its Polonnaruwa event that it would be a gathering of farmers and their representatives, but the SLPP made no bones about the fact that its rally would be a show of strength. The arrest and remand of NPP National Organiser Namal Rajapaksa provided the Opposition with a fresh rallying point, and former President Mahinda Rajapaksa’s participation at its rally helped the SLPP attract large crowds. The SLPP’s success in Anuradhapura will prompt the NPP to hold a bigger rally either there or elsewhere. It will also encourage the Opposition to hold more such rallies.

However, the question is whether crowd sizes are a reliable indicator of the real strength of political parties. One may recall that in 1977, the then Prime Minister Sirimavo Bandaranaike’s election rallies attracted large crowds. But the SLFP suffered a humiliating defeat at the general election that followed. It was reduced to a mere eight seats, and the UNP secured a five-thirds majority. It took the SLFP and its allies 17 years to make a comeback.

Ahead of the 2010 presidential election, common Opposition candidate and former war-winning Army Commander Gen. Sarath Fonseka held a series of huge rallies across the country, so much so that at one of them he threatened to have all members of the Rajapaksa family incarcerated immediately after securing the presidency. He lost the election, and the Rajapaksas had him thrown behind bars. Sixteen years on, the members of the Rajapaksa family and their associates are accusing the incumbent government of having launched a political witch-hunt against them.

After securing a second term in 2010, President Mahinda Rajapaksa also held a series of successful rallies across the country, and his election meetings attracted large crowds. But he lost to Maithripala Sirisena, who was widely considered a dark horse, in the 2015 presidential race.

In this day and age, crowd sizes could be deceptive. Astroturfing or creating an impression of widespread grassroots support for a party or an individual, where little such support exists, is the name of the game in politics. Some manpower agencies can be hired to bus crowds to political rallies, as Dr. Wijeyadasa Rajapaksha, who contested the last presidential election, revealed during a campaign rally, claiming that some of his rivals used paid participants to create the illusion of widespread public enthusiasm and support. The rent-a-crowd industry is said to thrive during elections.

There is no better test of a political party’s strength than an election. Therefore, if the JVP-NPP government is confident that it is more popular than its political opponents, it ought to hold the much-delayed Provincial Council (PC) elections instead of using various ruses to postpone them indefinitely. Last week, it unashamedly extended the term of the Parliamentary Committee tasked with electoral reforms until December 2026, prompting the Opposition to withdraw from it. The PC polls have not been held since 2017, when the UNP-led Yahapalana government postponed them because it was wary of facing any electoral contest. The JVP, the SLFP, the SLMC, the ITAK and the Joint Opposition, which later became the SLPP, helped that administration amend the Provincial Council Elections Act and postpone the PC polls. What is needed to hold the PC elections soon is a simple amendment to the PC Elections Act to enable the Election Commission to conduct them under the Proportional Representation system. Perhaps, a string of defeats the JVP/NPP has suffered at cooperative elections may have prompted the government not to hold the PC polls.

All signs are that the government will continue postponing the PC elections until the next presidential election, with only political dog-and-pony shows in the meantime.