COLOMBO: Sri Lanka has agreed to signal a recent cope with India to lease out 14 out of the 99 tanks on the strategic World Warfare II-era oil tank farm for 50 years within the jap port district of Trincomalee, Power Minister Udaya Gammanpila stated right here on Friday.
Gammanpila stated the deal shall be signed subsequent week after getting approval from the Cupboard.
The brand new settlement shall be an extension of the 2002 settlement with the native operators of the Indian Oil Firm, LIOC.
Sri Lanka in 2002 entered the unique cope with India on the island’s most strategic oil storage advanced, which was used as a provide base throughout World Warfare II.
India always had proven a strategic curiosity within the Trincomalee tank farm which the British rulers had constructed to refuel Allied warships and plane. “The LIOC may have the management of simply 14 of the 99 tanks over a 50-year lease,” Gammanpila stated whereas talking to reporters right here.
He stated 61 tanks out of the full variety of 99 tanks could be run below the newly-established three way partnership firm Trinco Petroleum Terminals Ltd. fashioned between the state oil entity, Ceylon Petroleum Company (CPC) and the LIOC with CPC holding the bulk 51 per cent stake.
Gammanpila, who had beforehand stated his intention was to reacquire full management of the tanks, claimed the brand new deal was “a triumph for Sri Lanka”.
In October, President Gotabaya Rajapaksa informed visiting Overseas Secretary Harsh Vardhan Shringla that Indian traders are invited to spend money on the island nation and Sri Lanka was eager to resolve the scenario relating to the Trincomalee oil tanks in a fashion that’s helpful to each nations.
The World Warfare II-era oil storage facility within the strategically advantaged port district of Trincomalee has been a key bilateral financial partnership hyperlink for many years.
Since 2003, the Lanka IOC, the Sri Lankan subsidiary of India’s oil main Indian Oil Company (IOC), has the leasing rights to 99 tanks on the facility for a interval of 35 years for an annual cost of USD 100,000.
Shringla had additionally visited the oil storage web site throughout his journey to Sri Lanka. The go to was thought-about important as oil sector commerce unions within the nation have demanded that the tanks be introduced below the management of the state gas entity Ceylon Petroleum Company (CPC).
The formalisation of the settlement subsequent week will come within the background of Sri Lanka looking for India’s assist to tide over its present financial woes exacerbated by the continuing overseas change disaster within the native economic system.
Officers stated that the island nation has shut its solely refinery for its incapacity to pay for crude oil and was negotiating a credit score line with India for gas purchases.
