Following the exposure by The Sunday Island

The controversial move to build a cross-country oil pipeline at a whopping cost of Rs. 15 billion has been halted on a presidential directive.

“The proposed project has been scrapped on an order by President Gotabaya Rajapaksa”, industry officials said.

The presidential intervention was triggered by The Sunday Island lead story headlined “Moves to kick-start Rs.15bn mega pipeline project comes under fire” in the December 13, 2020, edition.

Minister of Energy, Udaya Gammanpila, has intimated that the proposed project has been called off, the officials said. “A memorandum is expected to be submitted to the Cabinet on the cancellation”.

The cross-country project was first proposed during 2013-14 but was shelved with the construction of the Muthurajawala oil tank farm, which was augmented by a new oil pipeline at the Sapugaskanda Oil Refinery by the CPC (Ceylon Petroleum Corporation) engineering team.

However, moves to revive the dormant multi-billion rupee initiative emerged during the previous government, with then Minister Kabir Hashim presenting to the Cabinet a bid by Langfang-based China Petroleum Pipeline Bureau to push ahead with the costly initiative.

Attempts to implement the proposed project under the present dispensation ran into a storm with industry players slamming the move as a “criminal waste of public funds” in the backdrop of the anticipated long-term slide in fuel consumption for thermal energy with three key Liquified Natural Gas (LNG) projects poised to enter Sri Lanka’s energy market.

In addition, the Mannar wind power plant has already been commissioned, with a solar power project at Siyabalanduwa also on the cards.

CPC engineers have assured that the project, if deemed necessary, can be completed under a Rs. 5 billion investment – one third of the estimated cost quoted by the Chinese bidder.

If not for the President’s intervention, billions of rupees would have been dumped on a white elephant, which would have ultimately been rendered redundant with alternate sources of power supplementing the national demand for energy, the officials noted.

With their hopes of riding the gravy train shattered following the presidential directive, some ‘local Sherlock Holmes types’ have been unleashed to snoop around to identify possible “sources” behind leaking the detailed story to The Sunday Island, they said.

They are out with daggers drawn, the officials laughed. “After all, letting 10 billion bucks slip through their fingers is no joke!”.