The Board of Investment of Sri Lanka said the construction would begin this weekend on the refinery and storage facility jointly financed by Oman’s Ministry of Oil and Gas and a Singapore-registered company.
Sri Lanka’s Deputy International Trade Minister Nalin Bandara said he expected the refinery, which will eventually produce 200,000 barrels a day, to be fully operational within four years.
Oman will fund 30 per cent of the new oil refinery project while Singapore-based Silver Park International, which is majority owned by a business interest in India, will finance the rest.
“This is the biggest single foreign investment [in Sri Lanka’s history],” Bandara told reporters in Colombo. It is more than double the next largest foreign investment - a US$1.4bn land reclamation project next to the Colombo port.
The new refinery project will be constructed near the Port of Hambantota, which was leased to a Chinese state-owned enterprise in 2017 for 99 years after Sri Lanka was unable to service a loan from Beijing.
“The latest investment shows that companies in other countries too are interested in going to Hambantota,” Bandara said.
Sri Lanka attracted a record US$2.37bn last year in foreign direct investment, up 38 per cent compared to the previous year, official figures show.