Sri Lanka will build a second refinery with a capacity of at least 100,000 barrels per day (bpd) in a tie-up with Indian Oil Corp, a top Sri Lankan official said on Thursday, a move that strengthens New Delhi's engagement with Colombo.
India has been vying for major projects in the island nation where China has secured multi-billion dollar infrastructure projects including a $1.4 billion high-end property development and others ranging from a coal plant to ports.
T.G. Jayasinghe, the head of state-run Ceylon Petroleum Corp (CPC) said the new refinery will be built at the eastern port city of Trincomalee with the aim of exporting fuel.
“Usually it takes four years to build a refinery,” he told Reuters adding that oil tanks for storage were already in place.
IOC's local subsidiary, Lanka IOC operates 15 oil tanks out of the total 99 tanks there. Prime Minister Narendra Modi last year pledged to establish a petroleum hub in Trincomalee near the world's second deepest natural harbour. Lanka IOC was given control of the Trincomalee oil tank farm in 2001 under a 30-year deal and government has asked the company to jointly develop and operate the unused 84 tanks.