Govt to drill 4 new gas wells by IOCs

FE Team | Published: October 22, 2013 00:00:00 | Updated: February 01, 2018 00:00:00

M Azizur Rahman The government will drill four new onshore gas wells by international oil companies (IOCs) to raise output to meet the country's mounting natural gas demand, a top official said Sunday. Petrobangla has already invited bids from global firms to drill the four onshore gas wells in a state-owned field, Petrobangla Chairman Hussain Monsur told the FE Sunday. He said the four wells would be drilled in the Titas gas field owned by state-owned Petrobangla's subsidiary Bangladesh Gas Fields Company Ltd (BGFCL). The government has moved to drill the four onshore gas wells by the IOCs as the country's lone oil and gas exploration company -- Bangladesh Petroleum Exploration and Production Company Ltd (Bapex) -- does not have much scope to drill these wells immediately, said the official. Bapex is currently 'overburdened' with its existing job, he added. Titas, located some 100 km off the capital, is Bangladesh's second largest producing gas field after US's Chevron-operated Bibiyana gas field. Titas is now producing around 470,000 million cubic feet per day (mmcfd) of natural gas from 17 producing gas wells against the overall production capacity of 478 mmcfd, Petrobangla data reveals. The last date for selling tender documents is November 27 next. Interested oil and gas exploration firms must submit bids within the deadline for closing of tender submission on November 28, 2013. The bid winning international firm would also be responsible for third party engineering services regarding drilling of the four gas fields -- Titas-23, Titas-24, Titas-25 and Titas-26. According to the tender notice, the third party engineering services include cementation, mud logging, wire-line logging, supplying of explosive, detonator core and analysis, drill stem testing wire-line or slick-line operation, supply of drill bits and nozzles, mud and completion chemicals etc. Multilateral donor agency -- Asian Development Bank -- will bear most of the costs to drill the onshore gas wells in Titas gas field in Brahmanbaria district. Currently Russian Gazprom is the lone international oil and gas company engaged in drilling of wells on contract basis in Bangladesh. The Russian company inked deals with Petrobangla subsidiaries, Bangladesh Gas Fields Company Ltd (BGFCL), Sylhet Gas Fields Ltd and Bangladesh Petroleum Exploration and Production Company Ltd (Bapex) on April 26, 2012 to drill 10 development wells across six gas fields at a total cost of $193.5 million. Gazprom's contracts cover construction of the drilling pad, camp warehouse and site preparation, rig shifting and commissioning, procurement of drilling materials, engagement of third party services, drilling, testing and commissioning and insurance coverage. Gazprom got gas on May 21 when it was testing Srikail-3 onshore well, located in Comilla some 86-km southeast from the capital. Gazprom received around 12 mmcfd of gas, while testing. But the Srikail-3 well has the potential to supply upto 30 mmcfd of gas. Petrobangla awarded Gazprom the contract to develop the wells after Polish oil and gas explorer Poszukiwania Nastyi Gazu Krakow backed out after being selected in a competitive tender. The government has passed a law that bypasses the tender process and prevents deals inked under the new law from being challenged in court. Other international oil companies in Bangladesh operate under production sharing contracts (PSC) or joint ventures with Petrobangla's subsidiary, Bangladesh Petroleum Exploration and Production Company Ltd, or Bapex. Bangladesh is currently reeling under acute gas crisis with the production hovering around 2,310 mmcfd against demand of more than 2,700 mmcfd.