"We are optimistic that this will be commercially successful,? Petroleum Industries Minister Susil Premajayantha said.
In a statement, the company said it drilled at a water depth of 1,354 metres but that further drilling was required to establish the commercial viability of the discovery.
The Mannar Basin has eight blocks. Sri Lanka granted two to India and one to China in 2007. Officials from Russia?s largest oil company, Gazprom, recently toured the area to discuss exploration in the Mannar Basin.
Government seismic data indicate the area could have up to a billion barrels of oil. At present though, Sri Lanka is totally dependent on oil imports, at the tune of US$ 3 billion in 2009.
Since the end of the civil war two years ago, the government has tried to boost oil and gas exploration.