Onshore gas exploration

The debate over offering exploration of onshore gas to international oil companies (IOCs) has been in the air for quite sometime. The government, too, is in double mind. This is reflected by its decision to open up onshore gas bocks to the IOCs only to be reversed subsequently by protests from many quarters, including local experts and geologists. The factors underlying the protests that led the government to retreat from its earlier stand need to be well reasoned. In this context, the rationale should be a broader one, involving more than looking after the interest of the state-owned Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX). Since the issue is about successful exploration at reasonable costs, the focus should be on how best the job is done.
The government last month had planned to invite bids for the country's unexplored onshore oil and gas blocks from the IOCs. The decision came after a lull of almost two decades. The authorities were of the opinion that all the onshore areas, except those already identified for exploration by BAPEX, would be put on offer for foreign oil companies. There were reportedly mounting demands on the government from the IOCs to launch new bidding that would allow on-shore hydrocarbon exploration by foreign companies. The government decision might also be prompted by the fact that keeping on-shore exploration exclusively for the BAPEX did not auger well for the country's energy sector. But as the protests gained in strength, the government quietly backed away from its decision, which many consider a wise step for the moment.  "We have decided not to open the onshore blocks to the IOCs as we think it would be wise to keep it for exploration by the state-run exploration company, BAPEX," said the Secretary, Energy and Mineral Resources Division (EMRD). There is not much to count on this statement to justify the decision in as much as the actual business of exploration is concerned.
Bangladesh did not offer any onshore oil-gas blocks for exploration by the IOCs since 1997. The government had launched two international bidding rounds in 2008 and 2012 for hydrocarbon exploration by foreign oil companies. On both the occasions, the bids were confined only to the offshore blocks. At present, the country's entire natural gas production comes from onshore gas fields as there is no offshore gas field following the closure of Sangu-11 well in the Bay of Bengal in 2013.  Of the total output, the IOCs, according to BAPEX sources, are producing 58.16 per cent of natural gas, while the state-owned gas firms are producing the rest.
One of the reasons for protests against the IOCs' involvement with onshore exploration was the high cost, which, as the protestors claimed is many times that of the domestic explorers. Another reason stems from what has been dubbed 'command over the country's reserves of natural gas by the IOCs'. Now, while keeping onshore explorations exclusively for BAPEX, these should be key considerations beside ensuring that noticeable moves are initiated with a view to achieving the desired results.