Commodity Online
COLOMBO : Srilanka on Monday confirmed an agreement with Cairn India Ltd to explore oil and gas deposits in the north-western Mannar gulf of the island.

Sri Lanka’s minister of petroleum resources A.H.M. Fowzie said, “Today we signed an agreement with Cairn India, formally offering them the rights to explore oil and gas deposits at block one in the Gulf of Mannar.”

Indrajit Banerjee, a Cairn India director, signed the agreement with Fowzie in the presence of President Mahinda Rajapaksa, Prime Minister Ratnasiri Wickramanayake and several cabinet ministers.

Fowzie said the company has handed over a cheque for $1 million to the government. Eight blocks have been identified for oil exploration in the Mannar Gulf, with Cairn India getting block-one.

The minister said arrangements have been made to accelerate all activities related to Cairn, which is expected to commence exploration by early next year.