News
GoSL-New Fortress agreement: Engineers frown on modus operandi, gas supply contract
By Ifham Nizam
The government had done the right thing when it came to attracting investment into the energy sector, but the methodology it adopted was questionable, especially in signing such an important deal so hastily at midnight, senior independent engineers said.
They told The Island that with regard to New Fortress (NF) buying shares in Yugadhanavi it boiled down to a foreign direct investment at a time the country badly needed foreign exchange.
The government has signed a share sales agreement with NF to sell 40% of shares held by GOSL in Yugadhanavi power plant for USD 250 million, which is in line with the government Chief Valuer’s valuation as stated by GOSL.
“After all, the investor has to take his return through dividends from operations over 15 years and convert it to repatriate. Dividend declaration would be decided by the majority of shareholders and depend on availability of cash. When considering Sri Lanka’s current rating (C grade) this single investment of USD 250 million is a substantial contribution in terms of boosting foreign reserves and builds confidence in other investors,” a senior engineer said.
With NFE’s investment in the Floating Storage Regasification Unit (FSRU) terminal, overall foreign exchange inflow would be nearly USD 300 million.
A senior engineer at the Kerawalapitiya Plant said that CEB’s concern should be the gas price which would have a direct impact on its operations.
The senior engineer expressed concern about allowing FSRU terminal project to NF while a tender called by the CEB for the FSRU was being evaluated.
“Sri Lankan government being able to sell 40% for a 10-year-old heavy fuel oil (HFO) fired power plant for USD 250 million was a good deal but the problem is that it was linked to the gas supply, the top engineer said.
As far the West Coast Power Ltd., the owner of Yugadhanavi power plant, GOSL has 50%, EPF has 27% and LECO has 18.2% and Lakdhanavi has 4.8%.
A senior engineers said, ” The value of 250 USD for 40% is a good price on an assets base and future income based. The CEB will pay all future capacity charges in Sri Lankan rupees. There will be no change in capacity or fixed charges because a foreign investor is coming in. PPA and IA do not prevent change of shareholders. Similar changes in shareholding happens in the AES power plant, which is now owned by Sojitz Japan.
With the sale of shares the GOSL has allowed NF to supply Natural gas to Yugadanavi and the new power plant to be constructed. This could be a concern for the CEB.
Yugadhanavi now operates with Low Sulfur HFO, which is an imported product supplied through CPC; it is more expensive than normal HFO. However, at present, CPC refines and supplies low sulfur HFO.
When Yugadanavi operates on natural gas, the power capacity can be increased by 10% and fuel efficiency will be better. Therefore the overall tariff to the CEB will be lower than operating with HFO.
The new power plant to be built by NFcan run on natural gas or diesel only.
The issue may be how a US company has been selected to buy shares and supply gas. Selling shares is GOSL’s prerogative, which other shareholders or the CEB cannot challenge.
News
Pakistan naval trio arrives at Colombo Port
In a display of naval tradition, the Sri Lanka Navy formally welcomed the Pakistan Navy Ships ‘PNS Taimur’ and ‘PNS Aslat’, alongside the submarine ‘PNS/M Hangor’, arrived at the Port of Colombo on 01 Jun 26.
The Pakistan naval units made port in Sri Lanka for a goodwill visit as well as replenishment.
The visiting naval assets are commanded by a lineup of naval officers, with Captain Niamat Saeed Khan (‘PNS Taimur’), Captain Nadir Mateen Afridi (‘PNS Aslat’), and Captain Uzair Farooq (‘PNS/M Hangor’).
During their stay in Sri Lanka, the crew members of the visiting ships and submarine are scheduled to tour several key locations across the country.
Concluding the visit, the Pakistan naval units will engage in a Passage Exercise (PASSEX) with the Sri Lanka Navy off the west coast.
News
IMF turning a blind eye to NPP corruption: Opp.
The People’s United Opposition yesterday (01) alleged that the International Monetary Fund (IMF) had turned a blind eye to serious corruption allegations against the NPP government and was going ahead with the USD 2.9 bn loan in terms of the Extended Fund Facility (EFF) programme, finalised in 2023.
Addressing the regular weekly media briefing at the Flower Road Office of former President Ranil Wickremesinghe, former Ministers Prof. G. L. Peiris and Patali Champika Ranawaka questioned the failure on the part of the IMF to act in spite of the NPP government engaging in open corrupt practices, contrary to the terms and conditions of the agreement/understanding with the lending agency.
The media was told that the IMF couldn’t absolve itself of the responsibility for the actions of the government, especially because Sri Lanka, experiencing severe economic difficulties, was receiving loans from IMF at over 8%. Ex-parliamentarian Ranawaka pointed out that what Sri Lanka received from the IMF was not JAICA-type soft loans and the country was further burdened.
Prof. Peiris and Ranawaka alleged that the IMF appeared to have chosen not to take up the serious and growing accusations, particularly over coal and fuel scams that caused massive losses. They claimed the government had taken decisions at the expense of the country but for the benefit of certain businessmen close to them.
Both Prof. Peiris and Ranawaka explained the circumstances under which certain persons and companies received privileged status to import very costly vehicles and even helicopters and aircraft as the government
wasted precious foreign reserves for the benefit of friends. Ranawaka named two companies that benefited from government actions while alleging that those engaged in lucrative coal and fuel business made a killing.
They pointed out that the IMF released the latest USD 695 mn amidst stepped up serious allegations against the government. (SF)
News
Shavendra tells Beijing meet Sri Lanka should not become an arena for geopolitical rivalry among major powers
Former Commander of Sri Lanka Army with possibly the best battlefield record, having recovered the most amount of enemy occupied territory by troops he led from the front in the Vanni theatre of operations (2007-2009), General Shavendra Silva recently discussed growing challenges faced by smaller countries, like Sri Lanka, in what he called the evolving global environment.
Stressing that responsibilities must be shared across all states, the former Commander of the Sri Lanka Army told the 5th edition of the Wanshou Dialogue on Global Security in Beijing: “Major powers bear a special responsibility to exercise strategic restraint, avoid coercive practices, uphold international law, and contribute toward global stability rather than fragmentation.
Emerging and middle powers have an increasingly important role as bridge builders promoting dialogue, cooperation, and institutional reform.
For countries such as Sri Lanka, the path forward lies in principled and balanced diplomacy.
This requires maintaining constructive relations with all nations while safeguarding sovereignty, strategic independence, and national interests.
Sri Lanka has consistently maintained that its territory should not become an arena for geopolitical rivalry or military confrontation among larger powers.
Instead, our focus remains on strengthening national resilience through economic development, institutional stability, maritime awareness, modern defence capabilities, and agile diplomacy.
Credible domestic institutions, accountable governance, and national cohesion ultimately strengthen sovereignty while reducing opportunities for external interference.”
Referring to his service as Ambassador and Deputy Permanent Representative of Sri Lanka to the UN in New York, General Silva said that his engagements at the UN and other international forums reinforced the importance of defending national interests while remaining committed to reconciliation, development, and peaceful coexistence.
The celebrated battlefield commander discussed the transformation of global security, the future direction of the international order and the responsibilities of states in this transitional era. Silva said: “Today, security threats extend far beyond conventional warfare.
Cyber threats, terrorism, disinformation, economic coercion, artificial intelligence, and the weaponisation of technology increasingly influence global stability. At the same time, climate change, pandemics, food insecurity, and economic disruptions have demonstrated how closely national security and human security are now interconnected.
For Sri Lanka, located at the centre of the Indian Ocean along one of the world’s most important maritime trade routes, these developments carry direct strategic significance. Sri Lanka’s own experience offers valuable lessons.
The defeat of the LTTE, in 2009 demonstrated the importance of decisive state action against terrorism, while also revealing how modern conflicts become internationalised through financing networks, propaganda, illicit arms flows, and external geopolitical pressures.
The post-conflict period further reinforced the importance of reconciliation, economic recovery, institutional rebuilding, and long-term national resilience.
Smaller states increasingly face pressures arising from great-power rivalry, economic dependency, and strategic competition.
Sri Lanka has, therefore, consistently sought to maintain strategic balance while safeguarding sovereignty and constructive engagement with all partners.
China has remained an important development and economic partner for Sri Lanka over many decades. The relationship, strengthened through the 1952 Rubber-Rice Pact, expanded significantly in the post-war period through cooperation in infrastructure, connectivity, logistics, energy, and economic recovery. Projects associated with the Belt and Road Initiative have contributed to Sri Lanka’s development, regional connectivity, and post-crisis resilience. China also extended support during the COVID-19 pandemic and Sri Lanka’s recent economic stabilisation efforts.
The future international order must be shaped not by confrontation or exclusive blocs, but through pragmatic cooperation, institutional reform, and balanced multilateral engagement.
International institutions, particularly the United Nations system, must evolve to better reflect contemporary geopolitical realities and the growing voice of the Global South.
Without greater inclusivity and legitimacy, multilateral institutions risk losing effectiveness in addressing increasingly complex global challenges.
Equally important is preserving a rules based maritime order grounded in international law, particularly the principles of the United Nations Convention on the Law of the Sea.
The international community must also establish clearer norms governing emerging technologies, cyber operations, artificial intelligence, autonomous weapons systems, and outer space security.
Sri Lanka’s recent economic stabilisation efforts further demonstrated that internal resilience is essential for maintaining strategic autonomy and an independent foreign policy.
It is also an opportunity to build a more inclusive, balanced, and resilient international order capable of responding to the realities of the 21st century.
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