COLOMBO : The Government of Sri Lanka is to reach an agreement with the Government of Oman to secure a funding line of $ 3.6 billion to finance Sri Lanka’s oil procurements, The Sunday Morning learnt.
Highly placed government sources told The Sunday Morning that the Government of Oman had agreed to the funding line and that both countries agreed in principle to proceed with the programme.
Accordingly, the agreement is to be presented to the Cabinet of Ministers within two weeks, as the relevant document was currently being drafted, the source explained.
The terms of the agreement would provide the Government of Sri Lanka a five-year grace period and a repayment period spanning 20 years.
“The $ 3.6 billion will provide funds for us to purchase fuel for a period of 12 months,” the source added.
Sri Lanka currently incurs around $ 300 million on monthly fuel purchases.
When questioned about the discussions that were being held with the UAE and India on securing a credit line for oil, the senior government source noted that there would not be a necessity for any other credit line once the Oman deal was finalised.
However, the source noted that negotiations with India on the $ 500 million credit line would proceed, as the facility would be kept as a standby support mechanism in the event there were any increases in global oil prices in the future.
“These steps would ensure that the country would receive a steady supply of fuel,” the source observed.
The negotiations with the Omani Government were carried out by the Energy Ministry, it is learnt.
When contacted by The Sunday Morning, Minister of Energy Udaya Gammanpila did not deny the government-to-government (G2G) agreement to be reached between Sri Lanka and Oman.
He assured a continuous supply of fuel to the local market, adding that there was no truth to the claims by members of the Opposition that the country was facing a petrol and diesel shortage.(Sunday Morning )
