PETROLEUM RESOURCES IN SRI LANKA

R.M.T.D. MADUSANKADEPT OF FORESTRY AND ENVIRONMENT SCIENCEBSC STUDENT SEMINAR

University of Sri Jayewardenepura, 2015

Petroleum Resources in Sri Lanka.

R.M.T.D. MADUSANKA,

AS2012135,

Content. What is petroleum?

Formation of the Petroleum.

Global oil and gas fields.

Petroleum resources in Sri Lanka.

Geological background.

Past hydrocarbon explorations.

The regulatory & legal environment.

Organizational structure.

Operational structure.

Recent petroleum explorations.

Current status.

Environment impacts.

Recommendations.

Resource persons and references.

What is petroleum?

According to the article I of the petroleum resources agreement between GOSL & Cairns,

“Crude Oil or Condensate or Natural Gas existing in their

natural condition but excluding helium occurring in association

with Petroleum or shale”

Global oil and gas fields.

Do we have petroleum in Sri Lanka?

Yes!

Only offshore petroleum.

In 3 basins,1.Mannar.2.Cauvery.3.Southern.

Geological background.

Sri Lanka is mainly made up of Precambrian granites and metamorphic rocks.

Only 15% of the island, notably its northern corner close to India, is covered by sedimentary rocks.

•Shallow sedimentary cover

•Thick sedimentary cover

Petroleum can be find in those sedimentary rocks.

Past Hydrocarbon explorations.Sri Lanka’s efforts in oil exploration dates back to 1960s.

First reflective seismic in the north western region in 1967.

1974-1981, seven exploratory wells were drilled with assistance from Russian and US companies.

Some evidence of presence of hydrocarbons was found.

No serious efforts were made to extract oil, as it was said to be commercially unviable.

The Regulatory and Legal Environment.

Petroleum Resources Act 2003.

Petroleum Resources Development Committee(PRDC) - comprising of Secretaries of relevant ministries. - Granting of licenses. - Approval of development plans.

Petroleum Resources Development Secretariat (PRDS)- Director General + capacity from other govt. institutions. - Implementing activities for the PRDC

Operational structure of upstream petroleum industry.

Operational structure of upstream petroleum industry.. Cont…..

Brief story of recent petroleum explorations.

In 2002 and 2005, Norwegian contractor TGS NOPEC acquired 2D seismic data in Sri Lanka.

Based on the report, divided the basins into 13 exploration blocks.

First licensing round in 2007, -3 blocks were offered. -Only one awarded for exploration.

block SL 2007-01-001 in the Mannar Basin to Cairn Lanka.

In December 2009, Cairn conducted a 3D survey in its exploration block.

3 wells were drilled.• Barracuda.

• Dorado.

• Dorado-North

Two gas fields were discovered.

Potential reservoir capacity in excess of 2 TCF( Trillion Cubic Feet) of natural gas.

oDorado 30 km from the Sri Lankan coast in a water depth of 1,354m.

300 BCF( Billion Cubic Feet) of gas and 2 million BBL of oil.

oBarracuda 38 km west of the Dorado well and drilled to a total depth of 4,741m in 1,509m of water.

Needs further appraisal and quantification with detailed reservoir studies

One Dry well. o Dorado North

-plugged and abandoned as a dry well in December 2011.

Second bidding round.

Sri Lanka opened its second bidding round for oil exploration licenses earlier 2014.

Offered six blocks to carry out geophysical studies and collect associated seismic data.

Cairn India has bid for Mannar Block M5 and Bonavista Energy Corp bid for blocks C2 and C3 in Cauvery basin.

Studies are not started yet.

What is the current status?

Petroleum explorations were done in the block SL 2007-01-001 in the Mannar Basin.

But commercialization of those resources is the biggest problem.

Production stage is not started yet.

Exploration activities in the other blocks are also not started yet.

Environmental impacts.

Environmental Risk

Seismic surveyExploration &

production

Seismic survey. Use ultrasounds to investigate the petroleum resources in the sea.

Negative effect on sea animals,• Mammals-16 species were identified.• Birds-migratory bird route. • Benthic Invertebrates.

Negative effects on fisheries in north western coast.

Not a prescribed project in the NEA.

Its mandatory to be subject seismic project to EIA process as the PRA with cairns.

Exploration & production.Impacts on marine biodiversity,

oOil spills.

oWaste disposal.

oNoise & Light.

14 exclusive mangrove species and 29 species of mangrove associated species have been reported in the north western coast.

Lot of sea grass species.

3 Sea turtle species – nesting & feeding grounds.

Olive Ridley (Lepidochelys olivaceae )

Green Turtle(Chelonia mydas)

Hawksbill Turtle (Erytmochelis imbricata)

198 bird species.

Coral reefs.

Impact on fisheries in north western sea areas.

•Reduce the breeding grounds for fishes.

•Need to regulate the fisheries.

•Lost the freedom of fishing.

•Can lead to a conflict.

Recommendations.Indicate relinquishment of exploration blocks in the act.

Include the quantity of crude oil or gas shared by the government and the Contract Operator in the act.

PRDS should be adequately staffed with officials who should be exposed to off shore oil exploration.

Policy makers should familiarize themselves with the key principles of the financial and economic aspects of petroleum production.

Increase the confidence of international investors by ensuring institutional credibility and transparency.

complete the proposed Environmental baseline study as soon as possible.

Include seismic surveys in the prescribed project list in NEA.

Conduct awareness programs for the coastal communities specially for the fishermen.

Resource persons.

Mrs. D.T.K. Preeni Withanage,

Director-Benefits,

Petroleum Resource Development Secretariat.

Mr. Chathura Wijesinghe,

Environmental Officer,

Petroleum Resource Development Secretariat.

References.National energy policy & strategies of Sri Lanka.

petroleum resources act, no. 26 of 2003.

Initial environmental examination report - Three Dimensional Seismic Survey for Oil Exploration in Block SL-2007-01-001 in Gulf of Mannar-Sri Lanka.

Draft strategic Environmental Examination Report for Carvery Basin – Sri Lanka.

Sri Lanka Upstream Petroleum Benefits Report July 2008-March 2014.

Official web site of petroleum resources development secretariat , http://www.prds-srilanka.com/

http://www.lankabusinessonline.com/news/sri-lanka-to-update-petroleum-exploration-law/1868293023