Eight projects proposed to enhance gas reserves

Eight new projects are proposed for survey, exploration and extraction of hydrocarbons to enhance gas reserves in a latest push to cut Bangladesh's dependence on foreign-exchange-sapping imported petroleum fuels.

Sources say the total cost of the projects, put forward by Energy and Mineral Resources Division (EMRD), is estimated at Tk 136.95 billion.

Five of the projects, worth Tk 49.36 billion, will focus on enhancing natural gas supply through surveys and exploration, while two others worth Tk 8.55 billion is meant to strengthen the exploration capabilities of Bangladesh Petroleum Exploration and Production Company Limited (BAPEX) and the department of Geological Survey of Bangladesh (GSB).

Another project is for upgrading the existing network of Titas Gas Transmission and Distribution Company Limited (TGTDCL) for preventing leaks and addressing low- pressure problems in Dhaka, Narayanganj and the areas around.

This project with an estimated cost of Tk 79.04 billion is framed to help in developing combined Geographic Information System (GIS) mapping and installing a SCADA system in Titas network.

Government's Planning Commission has listed these as unapproved projects in the Revised Annual Development Programme (RADP) for the current fiscal year, leaving aside for future approval.

Experts and economists take these projects as welcome ones to boost gas exploration and reduce LNG-import dependence which would reduce pressure on the reserves of foreign currency and also help increase fiscal spaces for the government.

However, they urge the government to initiate proper management to ensure implementation of these projects at justified cost to prevent abuse of public money.

These projects will help in conducting three seismic surveys, drilling six exploration wells, two deep exploration wells and five appraisal-cum-development wells to boost searching and exploration, said officials of the EMRD.

Officials of the Planning Commission said Tk 94.91 billion, over 69 per cent of the combined costs of these eight projects, would be secured from domestic sources while the remaining Tk 42.04 billion managed from foreign sources as loans.

Higher officials from EMRD and BAPEX state that the proposals are part of a broader plan to implement government directive for strengthening energy security. Under this blueprint, the Energy Division has planned 23 projects by fiscal years 2028-29, including 15 well-drilling initiatives.

They have said the Executive Committee of the National Economic Council (Ecnec) has approved seven projects with an estimated cost worth Tk 38.27 billion since last August after takeover by the interim government led by Professor Dr Muhammad Yunus.

Out of the aggregate project cost, Tk 25.53 billion will be spent from government exchequer while another 38.27 billion to be managed from own sources of Petrobangla.

These endorsed projects will help in drilling five exploration wells and six appraisal-cum-development wells, conducting 3-D seismic survey in the area of around 1,450 square kilometers and installing process plant with a capacity of processing 60 million standard cubic feet per day (MMSCFD).

"The previous Awami League government deliberately halted domestic gas exploration and extraction, opting instead for costly LNG imports," Planning Adviser Dr Wahiduddin Mahmud said at a recent event.

He spelt out emphasis of the interim government on ramping up gas extraction from the existing reserves and exploring new fields, with a focus on strengthening BAPEX to reduce reliance on foreign companies.

The planning adviser of the interim government stressed the need for investment in domestic energy extraction and capacity building of Bapex to tap huge domestic energy potential, including unexplored cache of natural gas.

"Despite having significant gas reserves, our rising LNG imports and foreign-currency expenditures are straining the economy, while BAPEX lacks the capacity to extract gas, allowing foreign firms to take up to 90% of production with minimal local benefits," says the academic-turned government functionary.

Five out of the eight proposed projects will conduct three seismic surveys in the areas of 1,450 square kilometers, and drill six exploration wells, two deep exploration wells and five appraisal-cum-development wells to bolster searching and exploration efforts.

The project titled 'Enhancing and expanding the excavation capabilities of the Geological Survey Bangladesh (GSB)' with an estimated cost of Tk1.07 billion is to increase excavation capacity by procuring a drilling rig capable of exploring depths exceeding 1,800 meters-three times the current limit of around 600 meters.

Another project worth over Tk 7.48 billion will help in procuring rigs for Bapex with 2000-horsepower capacity.

Earlier, the EMRD had approached planning ministry to exempt five vital gas- exploration and-development projects from the mandatory third-party feasibility-study requirement, aiming that rapid exploration of gas will help reduce dependence on imported liquefied natural gas (LNG).

Currently, a feasibility study is mandatory for any project with an estimated cost of Tk500 million or over prior to approval of the project by the Executive Committee of the National Economic Council or ECNEC, according to Planning Division's guidelines.

Professor M Shamsul Alam, senior vice-president of the Consumers Association of Bangladesh (CAB), deplores that instead of utilizing domestic petroleum resources, demand was met through imports that led to high foreign-exchange spending and increased production costs in the industrial sector, in the last decade.

He suggests that the government should introduce immediate measures to explore gas and fuels to reduce dependency on high-cost imported LNG.

However, he stresses the need for transparency and efficiency in project expenditure, alleging that corruption during the Awami League rule had inflated costs in most projects in this sector.

"Standardizing the pricing of gas exploration, extraction, and distribution activities and executing these projects through government agencies at a unified rate would ensure cost-effectiveness," says the campaigner for consumer rights.

The energy expert also urges the government to put similar importance on the implementation of the projects rather than "approval only".

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