Final decision on gas price hike Sunday

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FHM Humayan Kabir
The government is likely to make its final decision relating to gas price hike by state-owned petroleum exploration company BAPEX Sunday, officials said.
The BAPEX (Bangladesh Petroleum Exploration and Production Company Limited), if receives the final government approval, will get gas price Tk 25 per thousand cubic feet (Mcf) against existing Tk 7.80.
"We'll have an inter-ministerial meeting on Sunday in the energy ministry. We will try to convince the government agencies to settle the issue," Chairman of Petrobangla Jalal Ahmed told the FE.
It was the finance ministry that held up gas price hike although Petrobangla was ready to pay at new rate from July this year, a senior BAPEX official said.
As per government directives, Bangladesh oil, gas and mineral corporation --Petrobangla - early this year agreed to pay Tk25 per unit gas to BAPEX from July 2008.
"I hope we will be able to convince the finance ministry and other government agencies concerned this time on the price hike at Sunday's meeting," Petrobangla chairman Mr. Ahmed said.
"If we pay higher prices, the ailing state-owned exploration company will get a boost financially. It will help the company take up more exploration works," he said.
So far, BAPEX has to sell all its produced gas to Petrobangla at only Tk 7.80 per unit, far less than its real production cost of between Tk 25 and Tk 50.
Petrobangla, in contrast, pays about Tk 121 ($1.75) to Tk 206 ($3) per Mcf of gas to the international oil companies (IOCs) for purchasing gas from their fields in Bangladesh.
US company Chevron, the UK's Cairn Energy, Irish firm Tullow, French oil giant Total SA and Canada's Niko Resources are working in different gas fields in Bangladesh under production sharing contracts (PSCs) with the government.
"The current gas sale price is lower than our production cost, which made us financially weak and disable in taking new exploration works," the BAPEX official said.