COLOMBO, Sri Lanka — Sri Lanka has agreed with India to jointly redevelop a strategic oil terminal consisting of nearly 100 large oil tanks, Energy Minister Udaya Gammanpila said on Tuesday, according to AP.
He said the Cabinet approved the proposal and an agreement with India should be signed within this month.
The project comes amid mounting concern over growing Chinese influence in this Indian Ocean island nation.
The facility, with a capacity of 8 million barrels of oil, is located on Sri Lanka’s eastern coast near strategically important Trincomalee port, which is considered as one of the best natural harbors in the world.
The cost of the project was not available.
According to the agreement negotiated by Sri Lanka and Indian officials for more than a year, 24 of the 99 tanks will be provided to Sri Lanka’s state-owned Ceylon Petroleum Corp.
Another 14 tanks which are currently used by Lanka IOC, a subsidiary of IndianOil, will be leased again to the same company for 50 years. The remaining 61 tanks will be managed by Trinco Petroleum Terminal Ltd, which is 51 per cent owned by Ceylon Petroleum and 49 per cent by Lanka IOC.
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