Hi Sean,
Looking at the stencil on that engine, it was rebuilt under the large engine programme that run through 44 District Workshops REME for many years, As the rebuild date is 1980, I can be 100% sure that the colour is Sky Blue, same colour as RL, MK, Land Rover and Mini engines that were done during that period. Not only that, but it is not a 28hp, but a 214 engine!
cheers Richard