Sri Lanka: Mining, Minerals and Fuel Resources

Topics Covered

Welcome to Sri Lanka
Overview of Resources
Industrial Minerals and Gemstones
Fossil Fuels

Welcome to Sri Lanka

Sri Lanka is an island nation located to the south of India in the Indian Ocean. The total area of the country is 65,610 km2, and it has a population of 21,481,334 as of July 2011. The country’s climate is predominantly tropical monsoon.

The national flag of Sri Lanka.
Image Credit: CIA Factbook.

Sri Lanka was formerly known as Ceylon when it gained its independence in 1948. The country has ever since been plagued by the violent disruptions caused by the Sinhalese majority and Tamil separatists. The decades long civil war between the government and Liberation Tigers of Tamil Eelam (LTTE) has affected the country’s progress to a large extent.

The end of the civil war has clearly helped stabilize the economic growth in 2010 and 2011, especially after the financial downturn of 2009. The GDP of Sri Lanka was $118 billion in 2011.

The natural resources of Sri Lanka include graphite, mineral sands, limestone, phosphates, and gems. The mining sector does not play a significant role in the country’s economy.

Overview of Resources

Sri Lanka has many industrial minerals such as dolomite, feldspar, ball clay, kaolin, calcite, gemstones, mica, mineral sands, graphite, limestone, phosphate rock, quartz, and silica sand.

In 2011, the country did not produce any metals or crude oil. It relied on imported petroleum for refining.

The map of Sri Lanka. Image Credit: CIA Factbook


In 2011, Ceylon Steel Corp. completed its three-year expansion project at Oruwela, thereby enabling the iron mill’s production capacity to expand to 250,000 Mt/yr from 100,000 t/yr.

Experts state that the black mineral sands of Pulmoddai beach contain heavy mineral concentrates amounting to about 12.5 million Mt. of which 65% is ilmenite, 10% is zircon, 10% is rutile, and small quantities of garnet and monazite.

Industrial Minerals and Gemstones

In 2011, Sri Lanka had a cement shortage situation due to the increase in demand, hence began importing cement from Indonesia, Pakistan, and Malaysia.

In the same year, Holcim Ltd. of Switzerland made plans to expand the grinding capacity of its cement plants and also to construct a new cement plant. Holcim (Lanka) Ltd. a subsidiary of Holcim operated a 1-million-Mt/yr-capacity cement plant at Puttalam. It also operated a grinding plant at Galle.

Sri Lanka has an array of gemstone deposits. The Highland Complex in the country is known for its high-grade metamorphic land rich in gemstones.

The two major graphite producers in the country are Bogala Graphite Lanka plc and Kahatagaha Graphite Lanka Ltd. The combined production capacity of the two companies amounted to about 11,000 t/yr in 2011.

Fossil Fuels

In 2011, Cairn Lanka Ltd., a subsidiary of Cairn India Ltd., discovered potential gas reserve in a well on one of the blocks in the Mannar Basin in Sri Lanka. The Mannar Basin is divided into eight blocks. The combined capacity of the eight blocks is estimated to be more than 1 billion bbl of oil. Around $2 billion/yr is spent on petroleum imports.


The government of Sri Lanka is working towards better economic growth and has implemented many government reforms and policies to encourage private (foreign and domestic) investment so as to develop the impoverished areas of the country.

Experts believe that the discovery of natural gas in the Mannar Basin will persuade the government to start issuing permits for oil and gas exploration in the near future.

Recent reports state that Sri Lanka’s gem and jewelry industry is heading towards becoming a global gem trading zone in the coming years. The industry currently is hoping to earn $600 million this year. The amount of gem reserves in the country is likely to ensure that Sri Lanka’s gem market reaches $ 1billion by 2016.

Another piece of positive news for Sri Lanka's mining sector is that the Geological Survey and Mines Bureau plans to use an airborne geophysical survey system to help locate the concealed mineral resources around the country.

Disclaimer: The Author of this article does not imply any investment recommendation and some content is speculative in nature. The Author is not affiliated in any way with any companies mentioned and all statistical information is publically available.


Disclaimer: The views expressed here are those of the author expressed in their private capacity and do not necessarily represent the views of Limited T/A AZoNetwork the owner and operator of this website. This disclaimer forms part of the Terms and conditions of use of this website.

G.P. Thomas

Written by

G.P. Thomas

Gary graduated from the University of Manchester with a first-class honours degree in Geochemistry and a Masters in Earth Sciences. After working in the Australian mining industry, Gary decided to hang up his geology boots and turn his hand to writing. When he isn't developing topical and informative content, Gary can usually be found playing his beloved guitar, or watching Aston Villa FC snatch defeat from the jaws of victory.


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  1. Danushka Dissanayake Danushka Dissanayake Sri Lanka says:

    Excellent work :)

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