Prime Minister Sheikh Hasina has endorsed Petrobangla’s proposal to award two international oil companies (IOCs) rights to explore hydrocarbons in three shallow offshore blocks in the Bay of Bengal. “Last week, she (the Prime Minister) approved the proposal as the line minister. However, the proposal would be placed at the next cabinet meeting, for final approval,” Petrobangla chairman, Dr Hossain Monsur, told The Independent.
In accordance with the verdict of the International Tribunal for the Law of the Sea (ITLOS), Petrobangla has completed the re-mapping of offshore blocks, and prepared the draft model production sharing contract (PSC) for the offshore bidding round 2012. It has created three blocks in the deep sea, in the eastern part, and identified nine blocks in shallow water, which are situated in undisputed areas. Petrobangla selected Indian oil giant ONGC Videsh Ltd and the US-based ConocoPhillips Asia Pacific New Venture, to, respectively, explore SS-04 and SS-09, and SS-07 blocks, of shallow water in the Bay.
In the new PSC, there is no scope for exporting oil and gas, but gas can be sold to a third party inside Bangladesh.
According to the offer, ONGC Videsh Ltd will spend USD 58 million at block SS-04 (over an area of about 7,271 sq. km.) to conduct a two-dimensional seismic survey of 1,200 ‘line kilometres’, and drill one well in the initial mandatory work programme of five years, for exploration. Subsequently, it will conduct a 500-line-kilometres and 200-sq.-km. 3D seismic survey and drill one well. It will spend USD 85 million for conducting a three-dimensional seismic survey at block SS-09 (about 7,022 km.) of 300 sq. km. and for drilling two exploration wells in the first extension period
of two years, and four exploration wells in the second extension of two years.
ConocoPhillips offered to conduct a two-dimensional seismic survey at block SS-07 (about 5,776 sq. km. in area) of 1,347 ‘line kilometres’ and drill one well in the initial mandatory work programme
of five years for exploration; subsequently it will conduct a 1,000-line kilometres-long
and a 500-sq.-km.-wide line
survey.
A total of 14 companies had purchased bid documents to participate in the bidding round. The US-based Chevron, ConocoPhillips and ExxonMobil; Anglo-Dutch Shell Oil; Australia’s Santos and Carnavan; Statoil of Norway; Cris Energy of Singapore; Oil and Natural Gas Corporation (ONGC) of India; ENI of Spain; Premier of the UK; Bahrain Petroleum Company (BAPCO) of Bahrain; Cairn India; and China National Offshore Oil Corporation (CNOOC) were among the IOCs that purchased tender documents. However, they expressed their dissatisfaction over the price of gas that Petrobangla, the state-owned oil and gas company, had offered in the offshore bidding round-2012 package.
The two companies will deposit bank guarantees of the same amount as they had proposed in the bidding.
Bangladesh has four PSCs with the international oil companies (IOCs)—three for onshore and one offshore.
-With The Independent input
