In the present era, with the prevailing competition, the cost of production plays a vital role. As the price of petroleum oils, especially diesel and furnace oil are growing at a steeper rate than solid fuel price, finding a substitute for furnace oil is one of the alternative available. Furnace oil used in boilers can be totally substitute by biomass with an equivalent ratio of 3.5:1 kg/liter on the basis of calorific value. This may results in saving of more than 60% of operating cost and would have attractive payback period of 6-8 months. Sri Lanka has large agriculture base and very common of having Gliricidia as an under-grow. The other biomass fuels such as paddy husk, saw dust, firewood are also available in large quantities around the country. Objective of this article is to study the conversion of presently  running furnace oil fired boiler, which is located at Ambilipitiya paper factory,Sri Lanka to biomass fired external furnace boiler namely water-wall boiler, techno economical study of the project and commissioning. Further a case study, which was done previous to this study and running successfully, is described to show the viability of the conversion using the internal furnace method. This case study was done at a Textile factory namely Brandix Finishing, Siduwa, and Sri Lanka. The results will be reducing the operating cost of the boilers and reduction of green house gas emission.  Opportunities for rural people to get extra income by farming Gliricidia, extra income from saw dust, paddy husk, and firewood are indirect benefits of the project. This report gives details of technical, environmental and commercial aspects of this unique opportunity.      Supervised by: Dr.Primal Fernando, Senior Lecturer, University of Peradeniya