Envisioning an energy driven future, Petroleum exploration efforts undertaken thus far by Sri Lanka have resulted in the slow emergence of a new industry at national level, while gradually enabling the nation to consolidate a firm footage within the international energy arena. With the primary aim of achieving diverse, sustainable sector- specific development, local content development has played a vital role in the overall sphere of Petroleum exploratory drilling and development operations carried out by Sri Lanka, as a national venture in partnership with identified international operators. The impactful outcome derived from all such local content development initiatives entail a host of direct gains as well as favorable externalities simply defined as external benefits. These gains and benefits are often distributed and concentrated in the areas of fiscal or economic rejuvenation and capacity building linked towards employment generation at national level, sector- oriented knowledge and technology transfer, procurement of goods and services as well as growth and proliferation of enhanced research and development activity dedicated towards industry-specific chores.
Declaring the mode of delivering and deriving such gains and externalities is a mandatory requirement imposed by the present legislation governing upstream Petroleum operations undertaken by the nation. All such compliance requirements and conditions have been descriptively laid down in the Petroleum Resource Agreement (PRA) and local content guidelines issued from time to time. Furthermore, a well defined monitoring and reporting strategy has also been formulated for the enforcement of all such guidelines at successive stages of the operations-in-progress.
Provided below are the areas of improvement and progress required by way of local content development
At the inception, every contractor identified as an eligible partner prepared for investing in local off-shore Petroleum exploration operations and projects, should submit a comprehensive Local Content Development (LCD) plan outlining the favorable outcome of benefits associated with education, training as well as other categories, which the nation at large may eventually be able to derive during various stages of the undertaken operations. However, in compliance with such targets set at the outset, the contractor should subsequently submit a report containing all accomplished benefits to Sri Lanka.