The government is planning to conduct a multi-plan 2D seismic survey of the country's underwater hydrocarbon resources. The Petrobangla has recently submitted a proposal to the Energy and Mineral Resources Division (EMRD) seeking permission to appoint an international maritime seismic survey firm to perform a 2D survey.
It is anticipated that the international oil companies (IOCs) will be interested if the government completes a 2D seismic survey before inviting tenders for the new deep sea blocks. There are companies that carry out survey and sell the data directly to the IOCs. Bangladesh will not have any expenses because the work will be done with their own investment. Moreover, Petrobangla will have a share in the profits for selling data.
If the survey report is available within a year, the country will then go for final offshore bidding, most likely from 2016, to explore offshore oil and gas at the new blocks in the Bay of Bengal.
This will be the first survey of its kind in the country, as the importance of seismic surveys came into the spotlight following the settlement of maritime boundary delimitation disputes with Myanmar and India.
However, after a three-year pause, the government plans to formulate a fresh production sharing contract (PSC) model to award offshore hydrocarbon blocks in the Bay of Bengal. The previous four rounds were floated in 2012, 2008, 1993 and 1974.
The settlement of the maritime border disputes awarded Bangladesh a territorial sea covering 118,000 square kilometres and an exclusive economic zone extending to 200 nautical miles. This gives the country an oppor-tunity to explore and utilise
marine resources for economic development.
The country needs around 22.76 trillion cubic feet (tcf) of gas until 2025. On the contrary, the current recoverable gas reserve stood at 16 tcf that would last around 16 years.
Probable onshore fields are yet to be fully explored. Local experts have, however, done some commendable job in finding new reserves of hydrocarbon in some old wells. Steps to harness gas from those fields should gain momentum by now. But the authorities are reportedly not yet demonstrating proper enthusiasm and zeal for the purpose, with a befitting priority.
On the other hand, the IOCs did not earlier respond en masse to the bidding process for shallow sea blocks in the Bay of Bengal. Out of the nine blocks, only two bidders participated for three blocks. That too was a lukewarm response as those were received after expiry of an extended deadline.
What actually prevented the Petrobangla from collecting primary data about probable reserves in the onshore and offshore areas remains unknown. If this could not be done due to dearth of skilled manpower and machineries, why did it not opt for outside help?
The IOCs, according to available reports, have positively responded to the offshore bid in the Bay offered by India and Myanmar. Both the countries have provided relevant data to the IOCs needed for such exploration drives. Why Bangladesh lags behind on this count baffles many analysts.
However, the lukewarm response of the IOCs provided some good lessons for Petrobangla. Now it has improved the terms and conditions for the deep water blocks. The bidding for such blocks is expected to be held next month. Terms and conditions are likely to be competitive with those of neighbouring countries like India and Myanmar.
Under the proposed new terms and conditions, the Petrobangla may allow the contractors of new deep sea blocks to carry out tax-exempted operational activities and sell half of their discovered and extracted volume of hydrocarbon resources to any third party inside the country.
It also proposed raising the hydrocarbon price and cost recovery limit in a single year to attract the prospective IOCs to bid for the three deep water blocks in the Bay of Bengal.
Meanwhile, the scenario about the gas import situation from neighbouring countries remains disconcerting. Official-level talks to import gas from Myanmar through pipeline hit snags. The Petrobangla might suspend the much talked-about liquefied natural gas (LNG) import project as the short-listed contractors have shown no interest in installing a floating LNG terminal at Maheshkhali in the Bay of Bengal within a short span of time.
Bangladesh, which was earlier reported to have been 'floating' on one of the largest untapped gas reserve, has been facing critical gas supply situation for the last two years due to its discouraging performance about exploration, exploitation and extraction of gas from its 'hidden' reserve.
In fact, a number of IOCs had earlier written to the energy ministry with a request to carry out a seismic survey in the Bay of Bengal, prior to floatation of tender. They had also recommended splitting the country's offshore sea territory into a number of small gas blocks to accommodate an increased number of IOCs in offshore hydrocarbon exploration. That time, the government remained conspicuously silent.
There is no denying that the next bidding round for hydrocarbon exploration in the offshore of the Bay of Bengal is critically important for the country. An expedited process of bidding is necessary in view of the country's depleting gas reserves. The recent discovery of huge gas reserves by India and Myanmar in the Bay near Bangladesh's economic zone is clearly an eye-opener for Bangladesh.
szkhan@dhaka.net
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