ship.energy

Agreement signed to launch Hambantota LNG hub

The Board of Investment of Sri Lanka (BOI) has signed an agreement with Pearl Energy (Pvt) Ltd to launch a floating storage LNG trading facility at the port of Hambantota – and LNG bunkering opportunities could be on the cards.

In a statement issued yesterday (24 August), BOI said that the total investment for the Hambantota LNG Hub project is $97.2 million and the plan is to turn the facility into a ‘landmark infrastructure development for the region paving the way to broader access to natural gas as a primary fuel in South Asia’.

Pearl Energy will use a floating storage unit (FSU) with an initial capacity of one million tonnes per annum (MTPA) and BOI said that commercial operations will commence within six months’. Pearl Energy will also deploy small LNG carriers to distribute LNG to South India and the Maldives providing LNG.

Tania Siegertsz – Director, Pearl Energy, said: ‘It is our pleasure to embark on this journey of bringing clean energy to the doorstep of Sri Lanka & the region. Taking the ‘early mover’ Advantage we will strive to place Sri Lanka as a future LNG Hub of the world. Factors including the strategic location of Hambantota, Newly established stable government & its investor friendly policies & the fast growing regional demand for LNG encouraged our investors led by Mr. Omar Siraj of Saudi Arabia to place their confidence on this project despite the global economic downturn caused By Covid-19 pandemic.’

Siegertsz continued: ‘Though our project is launched targeting regional trade, the fact that a world class LNG hub will soon be within the Port of Hambantota, we are confident that Sri Lanka too will be encouraged to convert its power plants to LNG Thus saving millions of USD whilst also increasing the efficiency & producing more power to the national grid.’

In a final comment that will be of particular interest to ship.energy readers, she added: ‘The Port too could also commence using LNG for bunkering thereby making Hambantota Port & its industrial Zone as a “Clean Energy Zone” of the future.’

China’s Sinopec was selected last year to operate the Hambantota oil tank terminal and provide bunkering facilities.

Lesley Bankes-Hughes

Lesley Bankes-Hughes