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http://interfaxenergy.com/gasdaily/article/20896/sri-lanka-makes-push-for-gas-fired-power
Sri Lanka is keen to integrate gas into its energy mix despite facing setbacks in domestic exploration and production.
Since the discovery of gas off the coast of the Kalpitiya peninsula in the Gulf of Mannar in 2011, the Sri Lankan government has promoted the new discovery as a profitable resource to boost private investment and create jobs in the country’s energy sector.
According to a 2015 study by Sri Lanka’s Petroleum Resources Development Secretariat (PRDS), gas in the Gulf of Mannar is expected to flow at a rate of 2.0 million cubic metres per day (MMcm/d) in 2018, 4.0 MMcm/d in 2021 and 5.9 MMcm/d in 2023.
However, Cairn India’s withdrawal from two gas blocks in Mannar last year cast doubt over the availability of domestic gas in the country. The blocks have since been awarded to Total, which has yet to make a significant discovery.
Janaka Ratnasiri, former technical adviser to the Ministry of Petroleum, told Interfax Natural Gas Daily that Total is also exploring on the northeastern coast of Sri Lanka – as opposed to the Gulf of Mannar, which is in the northwest.
An energy specialist at a trade association in Colombo, who preferred to remain anonymous, said the government was looking to develop 10 additional offshore test wells on the northwestern coast by 2018, with a bidding round due to be launched by 2019.
Until a local discovery is made, the government intends to take advantage of low global prices by importing LNG. Ratnasiri, who was one of the authors of the 2015 PRDS study, said a port for accommodating LNG carriers is expected to be built on the western coast near Colombo. He added that, given the time it takes to lay a pipeline network, the gas will be transported by road.
Gas over coal
Sri Lankan President Maithripala Sirisena, who is also the minister for the environment, is keen to expand gas-to-power at the expense of coal-fired generation. To this end, two planned coal power plants – one 500 MW and one 1.2 GW – will now be gas-fired rather than use coal.
The plants will be built near Triconmalee Harbour, one in conjunction with the Indian government and the other with the Japanese. Colombo is waiting for a response from the other governments on the proposals.
The trade association source emphasised the importance of creating a cleaner economy through the development of gas-fired power. As more than 25% of Sri Lanka’s total spending on imports goes on fossil fuels, the specialist said building domestic gas sources was an equally important measure for managing the country’s balance of payments.
“Integrating gas-based energy into the economy will be important from both the environmental and energy security perspectives. The government will need to take steps in educating the public and industry on the significance and importance of the gas discoveries as it remains under-appreciated among both ordinary and industrial consumers as well as local policymakers,” said the specialist.
But Ratnasiri said the national power regulator, the Ceylon Electricity Board (CEB), has privately expressed its displeasure about this “sudden change in plans” saying the two new plants will be too expensive. The proposed coal plants had been under consideration since 2006 and had been delayed because of the time taken for approvals and land acquisition.
“The CEB is concerned that an LNG-fired plant cannot be built within the same timeframe as the coal plant, while the government wants to go ahead with its LNG import plans and a combined-cycle power plant [CCGT] by 2020,” Ratnasiri said.
“So the government is planning to acquire gas on a fast-track basis [instead of relying on domestic gas] and build a gas-fired CCGT plant near Colombo instead,” he added.
A key concern for the government regarding increasing gas use is its total cost, including the cost of its impact on the environment. According to the 2015 study, coal’s environmental costs make gas an attractive energy source.
“Though coal is generally said to be a cheaper source of electricity than gas, when the external costs are added, the situation gets reversed. Particularly in Sri Lanka’s case, where coal is imported and gas is domestic,” the study said.
Biomass is still the country’s major source of energy. It had a 44% share of the energy mix between 2010 and 2012, but according to figures by the PRDS that figure has since fallen. Electricity consumption in the country has grown at an average rate of 5.3% per year, although the infrastructure has kept pace, with electrification approaching 100% in 2016. According to the PRDS, hydropower still supplies around half of demand from the power sector, with the rest supplied by coal.
Sri Lanka is also expected to increase the share of renewable energy in its power mix to more than 20% by 2020. This will be achieved by adding solar and wind projects in addition to the hydropower, which is close to capacity
Sri Lanka is keen to integrate gas into its energy mix despite facing setbacks in domestic exploration and production.
Since the discovery of gas off the coast of the Kalpitiya peninsula in the Gulf of Mannar in 2011, the Sri Lankan government has promoted the new discovery as a profitable resource to boost private investment and create jobs in the country’s energy sector.
According to a 2015 study by Sri Lanka’s Petroleum Resources Development Secretariat (PRDS), gas in the Gulf of Mannar is expected to flow at a rate of 2.0 million cubic metres per day (MMcm/d) in 2018, 4.0 MMcm/d in 2021 and 5.9 MMcm/d in 2023.
However, Cairn India’s withdrawal from two gas blocks in Mannar last year cast doubt over the availability of domestic gas in the country. The blocks have since been awarded to Total, which has yet to make a significant discovery.
Janaka Ratnasiri, former technical adviser to the Ministry of Petroleum, told Interfax Natural Gas Daily that Total is also exploring on the northeastern coast of Sri Lanka – as opposed to the Gulf of Mannar, which is in the northwest.
An energy specialist at a trade association in Colombo, who preferred to remain anonymous, said the government was looking to develop 10 additional offshore test wells on the northwestern coast by 2018, with a bidding round due to be launched by 2019.
Until a local discovery is made, the government intends to take advantage of low global prices by importing LNG. Ratnasiri, who was one of the authors of the 2015 PRDS study, said a port for accommodating LNG carriers is expected to be built on the western coast near Colombo. He added that, given the time it takes to lay a pipeline network, the gas will be transported by road.
Gas over coal
Sri Lankan President Maithripala Sirisena, who is also the minister for the environment, is keen to expand gas-to-power at the expense of coal-fired generation. To this end, two planned coal power plants – one 500 MW and one 1.2 GW – will now be gas-fired rather than use coal.
The plants will be built near Triconmalee Harbour, one in conjunction with the Indian government and the other with the Japanese. Colombo is waiting for a response from the other governments on the proposals.
The trade association source emphasised the importance of creating a cleaner economy through the development of gas-fired power. As more than 25% of Sri Lanka’s total spending on imports goes on fossil fuels, the specialist said building domestic gas sources was an equally important measure for managing the country’s balance of payments.
“Integrating gas-based energy into the economy will be important from both the environmental and energy security perspectives. The government will need to take steps in educating the public and industry on the significance and importance of the gas discoveries as it remains under-appreciated among both ordinary and industrial consumers as well as local policymakers,” said the specialist.
But Ratnasiri said the national power regulator, the Ceylon Electricity Board (CEB), has privately expressed its displeasure about this “sudden change in plans” saying the two new plants will be too expensive. The proposed coal plants had been under consideration since 2006 and had been delayed because of the time taken for approvals and land acquisition.
“The CEB is concerned that an LNG-fired plant cannot be built within the same timeframe as the coal plant, while the government wants to go ahead with its LNG import plans and a combined-cycle power plant [CCGT] by 2020,” Ratnasiri said.
“So the government is planning to acquire gas on a fast-track basis [instead of relying on domestic gas] and build a gas-fired CCGT plant near Colombo instead,” he added.
A key concern for the government regarding increasing gas use is its total cost, including the cost of its impact on the environment. According to the 2015 study, coal’s environmental costs make gas an attractive energy source.
“Though coal is generally said to be a cheaper source of electricity than gas, when the external costs are added, the situation gets reversed. Particularly in Sri Lanka’s case, where coal is imported and gas is domestic,” the study said.
Biomass is still the country’s major source of energy. It had a 44% share of the energy mix between 2010 and 2012, but according to figures by the PRDS that figure has since fallen. Electricity consumption in the country has grown at an average rate of 5.3% per year, although the infrastructure has kept pace, with electrification approaching 100% in 2016. According to the PRDS, hydropower still supplies around half of demand from the power sector, with the rest supplied by coal.
Sri Lanka is also expected to increase the share of renewable energy in its power mix to more than 20% by 2020. This will be achieved by adding solar and wind projects in addition to the hydropower, which is close to capacity
