The Government is exploring alternative ways to develop and utilise the long-idle Oluvil Port on the Southeastern coast of Sri Lanka, with about Rs 57 million being allocated annually for coastal protection and maintenance linked to the facility, to bring the Port back into productive use and unlock the economic value, Minister of Energy, Ports and Civil Aviation Anura Karunathilaka said in Parliament on Tuesday (8).
Karunathilake said: “The Government is exploring the best alternative use of the long-idle Oluvil Port to operationalise the port premises at its optimum capacity to provide maximum economic benefit to both the region and the country, and an annual allocation of approximately Rs 57 million is provided for the implementation of the coastal protection and maintenance, as a measure to address the erosion issued association with the Oluvil Port, according to the Coastal Conservation and Coastal Revenue Management Department.”
“The move follows the failure of the Port to sustain its intended original operations, where the fisheries harbour commenced the operation from September 2013 until 2019. But the operation was suspended after 2019, while the commercial harbour could not be operationalised due to the required navigational depth, that could not be maintained due to recurring sand accumulation by two seasons in the year annually,” he said.
“Meanwhile, according to the information provided by the Coastal Conservation and Coastal Resource Management Department, compromising armour protection has been constructed along approximately 16.5 kilometres (km) of the coastal line to mitigate the coastal erosion occurring in the vicinity of Oluvil Port,” he added.
As cited by The Daily Morning Business as per the National Audit Office (NAO), the Port was developed with an interest-free loan of € 46.009 million from Nordea Bank of Denmark.
“This project was completed in 2012, and the final completion certificate was issued on 26 May 2015,” Karunathilaka said.
He also added: “Accordingly, a previous attempt to attract an investor through a Request for Proposal (RFP) for the long-term lease of land and buildings belonging to the Sri Lanka Ports Authority (SLPA) at Oluvil Port failed after the investor did not respond to a letter of intent within the stipulated time frame, and the matter was reported to Cabinet in 2025, where the proposal investment was not materialised.”
“Despite the steps to operationalise the Port, we still have not found any tangible solution to get the potential investor for this purpose. Upon the successful conclusion of this negotiation, we have received several proposals, but technical and financial issues in the proposals still needed to be resolved before a suitable investor could be selected,” Karunathilaka said.