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Tri-nation gas pipeline project set to be revived

November 19, 2011 00:00:00


Nizam Ahmed The authorities in Bangladesh, India and Myanmar are set to revive a decade-old tri-nation pipeline project, which has been re-evaluated as being the most feasible one, for mutually utilising natural gas, energy officials said on Friday. The project has been re-evaluated recently as the cooperation between the three countries improved in the couple of years after high-level visits of respective leaders to their immediate neighbouring ones, they said. Energy-starved Bangladesh has shown renewed interest in the project as bilateral trade relations between Dhaka and New Delhi improved substantially over the recent months. "Informal talks on the issue just have started and it may be too early to say something of concrete nature to the media at this stage," a senior energy official told the FE, requesting for anonymity. However, the sources said this time Bangladesh would have to prod India to go for the project, because the latter had already met some of its demands from its own new gas finds. "The talks may soon be tabled and discussed formally," the official added. The tri-nation gas-pipeline project was mulled initially in 1997 by the Mohona Holdings Limited of Bangladesh. It was then supported by the Indian gas transmitters. The tri-nation techno-commercial meeting with representations of all the three countries signed a draft memorandum of understanding (MOU) in Yangon in February 2005. The experts then estimated the project to cost around $1.0 billion. However, the project cost, on its re-estimation now, will be higher, technocrats said. However, Bangladesh finally declined to approve the project in 2006, putting forward duty-free access of Bangladeshi goods to India and rail road transit to Nepal and Bhutan as the pre-conditions. Bangladesh experts said the tri-nation gas pipeline project has now become a strategi cally important issue for Bangladesh. "If it is implemented, Bangladesh will also be benefited and will be allowed to buy gas from Myanmar, to meet local shortfall," Sanwar Hossain Chowdhury, managing director of Karnaphuli Gas Distribution Company Ltd. told the FE. However, officials and experts in India and Bangladesh consider that the relations between the two neighbours are now better than before, as both have agreed to provide each other a set of facilities including those in areas of trade and transit. Bangladesh which once was reported in both local and foreign media, to be floating on gas has now become a gas-starved country largely due to lack of appropriate and timely works relating to new drilling and exploration activities. It presently produces only 2.0 billion cubic-feet of gas against its requirements for 2.5 billion cft. For shortage of gas, Bangladesh had to choose expensive oil to fire some 30 new small power plants. More such oil-fired plants will be set up in next two years, official of the state-managed Bangladesh Power Development Board said. Meanwhile, the recoverable gas in Bangladesh's 22 on-shore blocks has fallen to some 10 trillion cft, while exploration in most of the 28 offshore blocks are not possible at the moment as the a UN arbitration is yet to give decisions on the disputed blocks in the Bay of Bengal with India and Myanmar. There is no certainty when the authorities will be able to survey all the unexplored blocks and extract gas, officials of the Petrobangla, hydrocarbon exploration wing of the ministry of power, energy and mineral resources, said. Under such circumstances, the tri-nation gas pipeline can provide some strong benefit also to Bangladesh at this stage, officials and experts said.

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