)
President Mahmud Ahmadinejad of Iran is
to visit Sri Lanka for two days from April
28, 2008, in response to an invitation from
President Mahinda Rajapaksa, who had visited
Iran in November, 2007. His engagements will
include the inauguration of the construction
of the Iranian-funded (US $ 450 million) Uma
Oya hydroelectricity project at Wellawaya in
the Monaragala district. When completed, the
project is expected to produce 100 megawatts
of electricity. The visit is also expected
to result in the finalisation of an
agreement for Iranian financial and
technical assistance for enabling the
Sapugaskanda oil refinery to handle Iran’s
light crude. This project is expected to
result in a further Iranian investment of US
$ one billion.
2. In this connection, quoting Sri Lankan
media, the "Teheran Times" of April 20,
2008, reported as follows: "Iran will
increase its investment in the expansion
project of an oil refinery in Sri Lanka up
to US$ one billion, Petroleum and Petroleum
Resources Development Minister A.H.M. Fowzie
said. According to the IRNA office in Tokyo,
Fowzie in an interview with Kyodo on
Wednesday said: "Iran's President Mahmoud
Ahmadinejad has allocated this amount which
would cover 70 per cent of the required
investment for the refinery's expansion, in
the form of a 10 year loan, with a five year
exemption period from payment of the loan's
instalments." Fowzie added: "Iran had
earlier too provided the oil we need free
from interest for four months." According to
the report, Iran is the largest provider of
crude oil to Sri Lanka. According to the
Kyodo report, Managing Director Ceylon
Petroleum Corporation (CPC) Ashantha De Mel
has said that the pilot study for increasing
the production of Sri Lanka's only refinery
from 50,000 to 100,000 barrels per day has
been completed by Iranian oil engineers. De
Mel added: "Iran would make the major part
of the required investment for expansion of
this oil refinery (70 per cent) and the CPC
would cover the rest (30 per cent)." Fowzie
said the project would yield noticeable
benefits for its investors. He said: "From
the economic point of view my affiliated
ministry too is interested in making
investments there." According to Kyodo, De
Mel who visited Iran in early April 2008,
expects the project's executive phase to
begin within the next three to four months.
Oil experts predict that Sri Lanka's oil
refinery would increase its production after
the Iranian oil engineers would end their
work within the next two to three years."
3. Iran has also agreed to provide
low-interest credit to Sri Lanka to enable
it to purchase military equipment from
Pakistan and China and to train a small
group of Sri Lankan Army and intelligence
officers in Iran. A team of about 10
officers has already proceeded to Iran for
training after a clandestine visit to Sri
Lanka by Brigadier Gen. Qassem Suleimani,
the Director-General of Iran’s Quds Force,
or the Jerusalem Brigade, which is, inter
alia, responsible for covert actions against
Israel and for liaison with friendly foreign
intelligence agencies. He is expected to
come again as a member of the entourage of
the Iranian President for further
discussions on intelligence co-operation
between the two countries.
4. According to reliable sources, Israel
is reported to have expressed to Colombo its
concern over the developing relations
between Sri Lanka and Iran and warned that
this could come in the way of supply and
sale of Israeli military equipment to Sri
Lanka in future. It has been reported by
these sources that Sri Lanka has already
shared with the Iranian intelligence copies
of the instructions, training and
maintenance manuals of the Israeli equipment
purchased by it in the past and allowed some
officers of the Quds Force to inspect the
Israeli equipment.