Indian Oil Corporation (IOC) is planning to redevelop the Trincomalee fuel storage tanks with an investment of about $183 million while the agreement will be signed in the next three months, an Indian media report says. 

According to the Mint news agency, IOC is in talks with the Sri Lanka authorities to redevelop the Trincomalee tanks with an investment of Indian Rupee 15,000 million ($183 million) while Lanka IOC obtains a 49% stake.

Two people who were aware of the development, have told Mint that IOC is in talks with Sri Lankan authorities, adding the investment amount is yet to be finalized.

"Talks are still underway. Things will take concrete shape in the next two to three months. Options are being explored on further energy partnerships with Sri Lanka," one of the two people cited above said on the condition of anonymity.

While LIOC will be taking 49% of the stake, 51% will be taken by the Ceylon Petroleum Corporation (CPC).

The second source had told Mint that India is looking at several ways at helping Sri Lanka meet its energy requirements and that a whole range of projects are being considered.

In January 2022, LIOC, CPC and the Government of Sri Lanka signed three lease agreements on jointly developing the Trincomalee oil tank farm.

According to the agreement that was signed last year, the current lease on 14 oil tanks under LIOC control has been extended by another 50 years and 24 tanks will be independently developed by the CPC. 

An additional 61 tanks will be jointly developed by LIOC along with the established Trinco Petroleum Terminals Ltd. (TPTL) – of which 51% of shares are expected to be held by the CPC and 49% by LIOC.