Sri Lanka fuel storage expansion has been outlined by the government as part of a broader effort to strengthen national energy security, increase reserve capacity, and modernize fuel distribution infrastructure, according to President Anura Kumara Dissanayake.
Sri Lanka fuel storage expansion outlined with new tanks and pipeline projects
Speaking in parliament, the president detailed a series of large-scale infrastructure initiatives aimed at expanding the country’s fuel storage network while improving the efficiency of fuel transportation and distribution. The projects, which involve multi-billion-rupee investments, are designed to enhance the resilience of Sri Lanka’s energy supply chain and reduce vulnerabilities in the fuel sector.
The central component of the initiative is the construction of a new fuel storage complex in Kolonnawa. The proposed facility will add 86,000 metric tons of storage capacity through the development of six new fuel tanks. In addition to these tanks, two previously decommissioned units will be replaced with newly constructed storage facilities, bringing the total number of new tanks under the project to eight.
President Dissanayake explained that the expansion represents a major step toward improving the country’s strategic fuel reserves. Once completed, the additional capacity is expected to provide approximately 10 extra days of fuel storage for the national supply system.
According to government estimates, the construction of the six new tanks will require an investment of about 3.32 billion rupees, while replacing the two older tanks will cost approximately 1.45 billion rupees. Authorities plan to complete the entire complex by 2027, marking one of the most significant fuel infrastructure developments in recent years.
Energy analysts note that expanding storage capacity is critical for countries like Sri Lanka that rely heavily on imported petroleum products. Greater storage capacity allows governments to maintain larger reserves, which can help stabilize supply during periods of global market volatility or logistical disruptions.
The government’s plan also includes major investments in fuel supply infrastructure linked to aviation. Authorities aim to strengthen the fuel supply network supporting Bandaranaike International Airport by constructing a dedicated oil pipeline connecting Muthurajawela and Katunayake.
This pipeline will be designed to transport Jet-A1 aviation fuel efficiently to the airport, a move that aligns with the government’s broader ambition of positioning Sri Lanka as a regional aviation hub. The project includes the development of a 63,000 metric ton jet fuel storage facility, which would create a roughly 10-day fuel buffer for the aviation sector.
Officials say the tender process for the aviation fuel infrastructure project has already attracted interest from private-sector investors. The government expects to award the contract within the coming weeks as part of efforts to accelerate implementation.
In parallel with these developments, the government is also focusing on modernizing the country’s existing oil storage infrastructure. Restoration work is underway at the historic oil tank farm in Trincomalee, where facilities originally constructed during the colonial era are being upgraded to restore operational capacity.
The rehabilitation program is being carried out in coordination with the Ceylon Petroleum Corporation, which is overseeing restoration and infrastructure improvements at the site. Once completed, the Trincomalee tank farm is expected to contribute approximately 210,000 metric tons of fuel storage capacity, further strengthening Sri Lanka’s strategic reserves.
To complement the expansion of storage infrastructure, authorities are also planning technological upgrades to improve fuel distribution efficiency. A 1.5 billion rupee tender has been launched to modernize fuel gantry systems used for loading tanker trucks.
The new system will replace manual crane-based operations with automated loading infrastructure, allowing fuel bowsers to be dispatched more quickly from distribution terminals. Officials say automation will reduce operational delays and improve the overall efficiency of fuel distribution logistics.
While the infrastructure investments represent a significant step toward strengthening energy security, some industry analysts believe that additional reforms may be necessary to fully transform the fuel sector.
Experts argue that greater market liberalization and stronger foreign direct investment (FDI) could accelerate modernization efforts and help expand fuel storage, refining, and distribution capabilities across the country.
Attracting large-scale private investment could also support the development of new infrastructure projects, including additional storage facilities, pipeline networks, and advanced fuel logistics systems.
Nevertheless, the government’s current initiatives signal a clear policy direction toward improving energy resilience. Expanding storage capacity, upgrading infrastructure, and improving fuel distribution systems are seen as essential steps to ensure reliable fuel supply as Sri Lanka continues its broader economic recovery.
If successfully implemented, the infrastructure upgrades could strengthen the country’s ability to manage fuel imports, maintain strategic reserves, and support growing demand from transportation, industry, and aviation sectors.