Four international companies coming from the world's two economic powerhouses are trying for a tie-up with state-run Bapex to explore hydrocarbons in four onshore gas fields in Bangladesh's southeastern hills, said officials.
Three of the oil-and-gas-exploration firms vying for establishing joint venture (JV) with Bapex are from China and one is from the United States.
China's China National Petroleum Corporation (CNPC), Citic Ltd and Jeo-Jade and Improved Petroleum Recovery (IPR) Corporation of the US have submitted bids showing interest for the JV.
They came up with bids for deals in response to a tender seeking expression of interests (EoIs) by global firms for the job of hydrocarbon exploration and production from the onshore fields, the sources said.
Bangladesh Petroleum Exploration and Production Company Ltd (Bapex) will select the best one from among the four bidders to jointly carry out exploration and development works at Patiya, Jaldi, Kasalong and Sitapahar, Bapex's geological divisional head, Md Mijanur Rahman, told the FE Saturday.
The bid-winning firm would invest required money to develop and drill these four wells while Bapex would own a stake following negotiations with the contractor, he said.
"Bapex will not be required to invest any money in the project," said the official.
The government would purchase natural gas to be produced from these fields at negotiated tariffs.
Of the four fields to be developed, Patiya was drilled during the early 50s, Jaldi in mid-60s and Sitapahar in the late 80s.
All of them were recorded as encouraging gas shows while Kasalong was ready to be drilled by an IOC.
These prospects are located very close to the industrial gateway as well as port city of Chittagong, which is an assured gas market having gas-transportation infrastructure in place, said sources.
All these four gas fields are located in Block 22 that covers an area of around 13,900 square kilometres.
The onshore block 22 was originally awarded to US-based firm United Meridian Corporation (UMC) in February 1997, following the country's first round of international bidding for oil and gas exploration.
Houston-based Ocean Energy later attained the right to explore hydrocarbons in the block through the UMC takeover.
But government took over the block from Ocean Energy in 2006 following its failure in conducting committed drilling works within seven years of contract.
This is Bapex's second move to explore and develop four onshore gas fields in the hills under JV with international oil companies (IOCs) within the past five years.
Under the previous move initiated in 2010, Bapex was all set to form a JV with Chinese Sinopec Shengli to drill all the four wells.
Sinopec Shengli and Bapex were set to establish the JV with 70:30 per cent stakes respectively in the four onshore gas fields in the hilly region of Chittagong.
Sinopec had agreed to fund the programme while Bapex was to receive 30 per cent of the output or the sales revenue without any upfront investment, said sources.
The Chinese firm, however, had sought right for third-party sale of the gas to be produced after developing the fields.
It had agreed to sell gas at $2.70 per Mcf (1,000 cubic feet) while seeking third-party sale right alongside.
Under the previous move Bapex had invited formally several selected IOCs to consider establishing JV to develop the four fields, ducking a bidding process, and had selected Sinopec.
After several rounds of negotiations the initiative was jettisoned in 2013.
The previous move for establishing a JV with the IOCs to develop such onshore gas fields was suspended for 'faulty procedure', said a Bapex official.
The state firm expects to expedite natural gas production after developing the four fields to meet a mounting need for the fossil fuel across the country.
Until date, Bapex has inked one 'controversial' JV with Canadian Niko Resources to develop some 'abandoned' onshore gas fields, including Feni and Tengratila, said officials.
Gas production and exploration from Niko-operated fields, however, remained suspended following a row related to payment for gas and compensation for gas-field blowouts.
Bapex was a 'sleeping' partner in the Niko-Bapex JV and had a carried-over stake of 20 per cent, while the remaining 80 per cent was of Niko's.
mazizur.rahman@outlook.com
Chinese, US firms submit bids to tie up with Bapex
M Azizur Rahman | Published: July 12, 2015 00:00:00 | Updated: November 30, 2026 06:01:00
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