Oil giants will be asked to avoid disputed offshore blocks
Sunday, 20 September 2009
M Azizur Rahman
The government will ask the US oil giant Conoco Phillips and the Irish Tullow to avoid oil and gas exploration in the disputed areas inside all the three blocks for which they were selected.
"We will ask both the companies not to carry out hydrocarbon exploration in the disputed areas of the offshore blocks due to overlapping of some areas as claimed by neighbouring India and Myanmar," Petrobangla Chairman M Muqtadir Ali told the FE Saturday.
The state-owned Petrobangla is yet to determine the areas that would be asked for relinquishment.
"We will hold discussions with the ConocoPhillips and the Tullow to settle the issue after analysing relevant maps of the foreign ministry," said the Petrobangla chairman.
Myanmar and India have already made their submissions to the Commission on the Limits of the Continental Shelf, a UN body to deal with the law of the sea, in December 2008 and May 2009 respectively, encompassing undersea basins that fall within Bangladesh's Exclusive Economic Zone (EEZ) stretching up to 200 nautical miles from the baseline.
Their claims included parts of the three blocks won by the ConocoPhillips and the Tullow.
The Petrobangla chairman said both the foreign companies have already been invited for signing production-sharing contracts (PSCs).
He expected that the signing of the PSCs would be completed by October next.
ConocoPhillips has been selected for DS-08-10 and DS-08-11, while Tullow for SS-08-05.
If signed, the country's total number of the PSCs would tick up to nine from the existing six PSCs with international oil companies.
ConocoPhillips would be given nine years for exploration in both of its blocks with a five-year time as initial period with two extension periods of two years each.
Subsequently three years would be given for project appraisal and next 25-30 years for production of petroleum in the Bay.
Tullow would be given eight years for exploration with a four-year time as initial period with two extension periods of two years each.
The Irish company would also be given three more years for project appraisal and next 25-30 years for production.
In its bid ConocoPhillips pledged to invest $110.66 million and offered a bank guarantee of the same amount for its two approved blocks, while Tullow made commitment to invest $49.85 million and offered a bank guarantee of $33.9 million.
ConocoPhillips has made commitment to conduct 2D seismic survey covering 1200 line kilometres (LKM) during its initial five years of exploration period with an investment commitment of $ 2.496 million offering bank guarantee of the same amount.
It has made commitment to conduct 3D seismic survey in 500 square kilometres and drill a well during the first extension period of two years investing $58.1665 million offering bank guarantee of the same amount.
The company has pledged to drill one well in its second extension period of two years with an investment commitment of $50 million.
Tullow has made commitment to conduct 2D seismic survey covering 570 line kilometres (LKM) during its initial four years of exploration period with an investment commitment of $ 18.50 million offering bank guarantee of $ 12.40 million.
It has made commitment to conduct 3D seismic survey in 700 square kilometres and drill a well during the first extension period of two years investing $ 23.65 million offering bank guarantee of $17.65 million.
Tullow has pledged to conduct 3D seismic survey in 400 square kilometres in its second extension period of two years with an investment commitment of $7.70 million offering bank guarantee of $3.85 million.
The government will ask the US oil giant Conoco Phillips and the Irish Tullow to avoid oil and gas exploration in the disputed areas inside all the three blocks for which they were selected.
"We will ask both the companies not to carry out hydrocarbon exploration in the disputed areas of the offshore blocks due to overlapping of some areas as claimed by neighbouring India and Myanmar," Petrobangla Chairman M Muqtadir Ali told the FE Saturday.
The state-owned Petrobangla is yet to determine the areas that would be asked for relinquishment.
"We will hold discussions with the ConocoPhillips and the Tullow to settle the issue after analysing relevant maps of the foreign ministry," said the Petrobangla chairman.
Myanmar and India have already made their submissions to the Commission on the Limits of the Continental Shelf, a UN body to deal with the law of the sea, in December 2008 and May 2009 respectively, encompassing undersea basins that fall within Bangladesh's Exclusive Economic Zone (EEZ) stretching up to 200 nautical miles from the baseline.
Their claims included parts of the three blocks won by the ConocoPhillips and the Tullow.
The Petrobangla chairman said both the foreign companies have already been invited for signing production-sharing contracts (PSCs).
He expected that the signing of the PSCs would be completed by October next.
ConocoPhillips has been selected for DS-08-10 and DS-08-11, while Tullow for SS-08-05.
If signed, the country's total number of the PSCs would tick up to nine from the existing six PSCs with international oil companies.
ConocoPhillips would be given nine years for exploration in both of its blocks with a five-year time as initial period with two extension periods of two years each.
Subsequently three years would be given for project appraisal and next 25-30 years for production of petroleum in the Bay.
Tullow would be given eight years for exploration with a four-year time as initial period with two extension periods of two years each.
The Irish company would also be given three more years for project appraisal and next 25-30 years for production.
In its bid ConocoPhillips pledged to invest $110.66 million and offered a bank guarantee of the same amount for its two approved blocks, while Tullow made commitment to invest $49.85 million and offered a bank guarantee of $33.9 million.
ConocoPhillips has made commitment to conduct 2D seismic survey covering 1200 line kilometres (LKM) during its initial five years of exploration period with an investment commitment of $ 2.496 million offering bank guarantee of the same amount.
It has made commitment to conduct 3D seismic survey in 500 square kilometres and drill a well during the first extension period of two years investing $58.1665 million offering bank guarantee of the same amount.
The company has pledged to drill one well in its second extension period of two years with an investment commitment of $50 million.
Tullow has made commitment to conduct 2D seismic survey covering 570 line kilometres (LKM) during its initial four years of exploration period with an investment commitment of $ 18.50 million offering bank guarantee of $ 12.40 million.
It has made commitment to conduct 3D seismic survey in 700 square kilometres and drill a well during the first extension period of two years investing $ 23.65 million offering bank guarantee of $17.65 million.
Tullow has pledged to conduct 3D seismic survey in 400 square kilometres in its second extension period of two years with an investment commitment of $7.70 million offering bank guarantee of $3.85 million.