EMRD to seek advisers' nod on bidding

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M Azizur Rahman
The Energy and Mineral Resources Division (EMRD) will seek consent from the council of advisers in a couple of days to launch the much-awaited offshore bidding for hydrocarbon exploration in the Bay of Bengal.
"We have already finalised the draft of a model production sharing contract (PSC) and obtained opinions of all the concerned ministries and government departments regarding the forthcoming bidding round," EMRD secretary Mohammad Mohsin told the FE Wednesday.
He said a proposal seeking the nod of the council of advisers on the bidding and the draft of the model PSC will be sent 'within a day or two.'
The EMRD in a meeting Monday last finalised the draft of the model PSC to be signed with the bid winning oil and gas exploration companies.
"We have planned to invite international tender for the offshore bidding round by December 31 next," the EMRD secretary said while commenting on it.
The contract with the bid winning companies is set to be signed by by August 31 next year, he said categorically.
"The next dry season would be the targeted period for initiating hydrocarbon exploration activities in the new offshore gas blocks by the bid winners," Mohsin added.
A total of 28 offshore gas blocks are planned to be awarded to the interested companies under the forthcoming 'Bangladesh Offshore Bidding Round 2007.'
These newly-created offshore gas blocks have been divided into two categories - 'A' type and 'B' type.
A total of 20 gas blocks belonging to the 'A' category are located between the seashore and 20 degrees north latitude into the Bay of Bengal.
While the 'B' category consists of eight deeper offshore gas blocks located between 20 degrees north latitude and 18 degrees north latitude in the Bay, a senior Petrobangla official said.
The areas of these offshore gas blocks have been proposed to range between 2,500 square kilometres and 7,500 square kilometres each.
"The sizes of the gas blocks have been proposed to be of the optimum size to interest an increased number of international oil companies in the bidding round," a senior EMRD official said.
To avoid too many negotiations over the PSCs and check 'unwanted influence' during the exploration work, the model PSC has been prepared outlining the facts more specifically compared to the existing ones, he said.
The EMRD also has planned to fix higher gas prices for the new gas fields to be explored under the forthcoming bidding round to lure a significant number of companies in the bidding.
The gas prices might not be less than US$4.0 per unit (1,000 cubic feet), EMRD sources said.
Currently the government has eight PSCs signed with international oil companies (IOCs) during the first and second round biddings in 1993 and 1997.
The first round bidding was held after the country was divided into 23 blocks for oil and gas exploration, making an amendment to the Petroleum Act in 1993.
After the first round bidding, the four onshore blocks-12, 13, 14, 22 and the four offshore blocks-15, 16, 17, 18 were awarded to the IOCs.
The second round bidding was held in 1997, when the blocks-5, 7, 9 and 10 were awarded to the IOCs and the blocks-8 and 11 were awarded to Bangladesh Petroleum Exploration and Production Company (BAPEX).