The government said Rajapakse had revealed the discovery while making an address to council workers in the central region of Kandy, where local elections will be held on Saturday.

"President Mahinda Rajapakse in Kandy announced that Sri Lanka has found a gas field for the first time," the information department said in a text message.

A presidential spokesman confirmed the announcement, but gave no further details.

Cairn India, a unit of British exploration firm Cairn Energy, has been drilling in the Mannar Basin since August after seismic studies suggested oil and natural gas deposits.

It was unavailable for immediate comment on Sunday.

Sri Lanka, which depends on imports for all its petroleum requirements, has also offered blocks off the coast to India and China.

Cairn in 2008 invested $100 million, spread over three years, to conduct detailed seismic studies. The company said at the time it would drill three wells.

In the early 1970s overseas companies explored areas off Sri Lanka's west and northwest coast, but failed to find any oil and gas reserves worth exploiting commercially.