BOI affirms Oman State-run firm keen on taking equity position in refinery project

In light of Oman Oil and Gas Ministry denying being part of a US $ 3.85 billion refinery project in Hambantota, Sri Lanka’s Board of Investment (BOI) yesterday said that they were aware Oman Oil Company has ‘firm intention’ in taking an equity position in the project.

Oman Oil Company is a petroleum investment company, which is wholly owned by the Omani government.

“…we are aware that Oman Oil Company has registered their firm intention to participate in equity up to 30 percent, subject to reaching agreement between the parties,” BOI said in a brief statement in response to Reuters new story quoting Oman’s Oil and Gas Ministry Undersecretary Salim al-Aufi, who said he was not aware of investments to be made in Sri Lanka.
“It came as news to me, I don’t know who is signing the cheque for US $3.8 billion,” al-Aufi was quoted as saying.

Meanwhile, the BOI further said that they were aware that Oman Trading International was willing to supply the entire feedstock requirement of the project as well as do the marketing for the products, upon reaching mutually agreed terms.

Oman Trading International is wholly owned by the government of Oman, with 70 percent shareholding by Oman Oil Company and 30 percent by the State General Reserve Fund (SGRF).
“The investor Silver Park International (Pte) Ltd., has conveyed to the Board of Investment their full confidence in implementing the project,” the statement said.

Sri Lankan officials told a news conference on Tuesday that a joint venture between the Oman Oil and Gas Ministry and a Singapore investment vehicle owned by India’s Accord Group had agreed to build the 200,000 barrel per day refinery near Chinese-controlled Hambantota port with an investment of US $ 3.85 billion.The ministry was to take a 30 percent stake, the officials said, representing what would be Sri Lanka’s biggest single foreign direct investment. 

According to BOI officials, the first phase of the refinery project is set to commence on March 24 at a ground breaking ceremony in the Mirijjawila Export Processing Zone where Prime Minister Ranil Wickremesinghe will be the chief guest.