The government has retreated from its decision taken earlier to open again the country's onshore blocks for oil-and-gas exploration to international oil companies (IOCs) as protests from local experts held sway.
"We have decided not to open the onshore blocks to the IOCs as we think it would be wise to keep it for exploration by the state-run exploration company, Bapex," Energy and Mineral Resources Division (EMRD) secretary Md Abubakar Siddique told the FE Monday.
The government in May this year had broached a plan to launch a new bidding round offering country's unexplored onshore blocks to IOCs, after a lull of almost two decades.
Back then, the authorities were of the opinion that all the onshore areas, save those to be explored by state-owned Bangladesh Petroleum Exploration and Production Company Ltd (Bapex), would be put on offer for the foreign firms.
The State Minister for Power, Energy and Mineral Resources (MPEMR) had announced the government plan on opening up the blocks during a briefing with the press.
Officials said the government had moved to launch new bidding round for onshore blocks following mounting demands from the IOCs operating in the country for opening up the onshore blocks, too, for carrying out hydrocarbon exploration.
A number of energy experts and teachers of different public and private universities last month protested the government move.
They held a protest meeting where Professor Badrul Imam of Geology Department of Dhaka University in a written statement dubbed the government move against national interest as an IOC would charge some four times of what Bapex would for supply of natural gas from an onshore field.
Besides, the foreign oil companies would have more command over the country's reserves of natural gas, which would "threaten national security", the statement said.
Industry-insiders said although the government reversed the decision, it would continue to appease the IOCs by involving foreign firms with onshore oil-and-gas exploration either on contract basis or through joint venture.
Russian Gazprom has already carried out 10-well-drilling task under contract.
Chinese Sinopec International Petroleum Service Corporation has already been awarded four onshore gas-well-drilling jobs in the Titas gas field.
Bapex has made a fresh move to explore and develop four onshore gas fields in the hills under JV (joint venture) with IOCs.
Bangladesh did not offer any onshore oil-gas blocks for exploration by IOCs after 1997 although the country's entire natural gas production comes from onshore gas fields alone.
After 1997 Bangladesh launched two international bidding rounds-in 2008 and 2012 -- for hydrocarbon exploration by the foreigners. But only offshore blocks were offered on both the occasions.
The outcome of the two consecutive bidding rounds, exclusively for offshore blocks in the past eight years, also did not bring any expected result for the country as not a single commercial discovery of hydrocarbons has been made by the IOCs.
Bangladesh's natural gas production is currently hovering around 2,600 million cubic feet per day (mmcfd) against a known demand for over 3,000mmcfd.
The country is currently dependent only on onshore fields for its entire natural gas production as the country does not have any producing offshore gas field after the closure of Sangu-11 well in the Bay of Bengal in October 2013.
Of the total output, the IOCs are producing 58.16 per cent, or 1,510mmcfd, of natural gas, while the state-owned gas firms were producing the rest, according to statistics of state-owned Petrobangla as on June 18, 2015.
Of the total natural gas production, US's Chevron Bangladesh alone was producing 1,410mmcfd from three onshore gas fields in Bangladesh-Bibiyana, Jalalabad and Moulvibazar-located in blocks 12, 13 and 14, respectively, in the country's northeastern region.
Gas shortages have prompted Petrobangla to ration new connections to industries, fertilizer factories and power plants since June 2009, stymieing the country's economic growth.
mazizur.rahman@outlook.com
