Gas production at Sangu dwindling alarmingly, may dry up in four years

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M Azizur Rahman
The country's lone offshore gas field -- Sangu - will dry up completely in next four years as the gas production there is dwindling alarmingly.
The Scottish Cairn Energy PLC - the operator of Sangu gas field - has already informed the government about the future prospects of offshore field after a lacklustre month-long drilling last winter.
"The per day gas production from Sangu gas field will decline by 20 million cubic feet every year," Energy and Power Adviser Tapan Chowdhury told the FE quoting the Cairn Energy analysis on the offshore gas field.
On Tuesday, Sangu gas production fell to its lowest at 81 million cubic feet per day (mmcfd), which is almost half of its last year's production of 159 mmcfd.
Gas pressure at the Sangu field is declining posing a setback in gas supply to the country's southeastern Chittagong region.
Sources said Cairn Energy suffered a net loss of $82 million in fiscal 2006-07, after writing down the value of its Sangu field operations in Bangladesh.
Sangu, which has provided a steady supply of gas since its start of production in 1998, is now on the wane forcing Cairn to revise its forecast of gas reserves there downward by 26 billion cubic feet.
Sangu gas field was discovered by Cairn in 1996 with a proven reserve of 0.8 trillion cubic feet (TCF).
The ownership of Sangu gas field was handed over to Dutch Shell Oil Company with assets and liabilities in 1998 by Cairn Energy.
But after production of gas for six years from Sangu, the Shell handed over all of its upstream assets and undertakings to Cairn Energy in 2004.
Petrobangla sources alleged that due to faulty design by the Shell contractors during Sangu exploration the gas drilling platform underwent repair works on a number of occasions.
The EMRD last year approved a US$63 million investment plan of the Cairn Energy for drilling of at least three development wells by April 2007.
Of the planned investment an amount of $32 million earmarked for Sangu gas field development, $18 million for drilling exploratory wells at Hatiya and the rest of the money for the appraisal well at South Sangu, company sources said
As per the plan, Cairn was supposed to drill a production well at offshore Sangu gas field, an appraisal well at South Sangu and an exploration well at Hatiya island within the given timeframe.
But Cairn failed to complete the scheduled task excepting the drilling at Sangu.
The company now intends to drill exploration well at Hatiya and Meghnama in the next winter.
Apart from its operations at Sangu gas field Cairn is currently engaged in exploratory activities in blocks 5 and 10, where new seismic data has been acquired, and got a tie-up with Chevron Corp in block 7, where a seismic campaign commenced recently.
It has identified a new prospective gas field at Char Jabbar under Noakhali district in block 10 with an indication of 2.30 Trillion Cubic Feet (TCF) of gas reserve.
Cairn has also conducted seismic surveys at Meghnama and at Hatiya under the block 16.
There are possibilities of finding gas reserves of about 3.5 TCF at Meghnama and 1.76 TCF at Hatiya, the company sources said.