Wednesday, February 21, 2024

Gazprom lets down govt; plans to boost gas output jeopardised

The government’s plans to increase gas production by 300 mmcf, from the existing fields, has been jeopardised as the Russian oil giant Gazprom has not fulfilled its contractual obligations to implement Petrobangla’s USD 197.55 million gas augmentation plan. The Russian oil company’s subsidiary Eriell has failed to drill even a single well. To implement the plan on a “war footing”, the government offered an “unsolicited” deal to Gazprom, to drill 10 onshore gas wells, on a turn-key basis. This was scheduled to be completed within 18 months of the approval being granted.
But, the Russian oil giant handed over the job to Eriell, a subsidiary of the state-owned gas exploration company, which has been described as “an inexperienced and weak company”.
“They (Gazprom) are doing it in a wrong way. I have written a letter to the Gazprom chief in this connection, and have requested him to take immediate action,” Petrobangla chairman Dr Hossain Monsur told The Independent.
According to him, Eriell has not brought ‘Christmas tree’, logging mud, chemicals and other necessary materials, for completing the drilling job. “Most of the time, they are asking for this or that from the Bangladesh Gas Fields Company Limited (BGFCL), which is problematic,” he added.
According to the energy ministry, Petrobangla signed the ‘unsolicited’ deal with Petrobangla in April 2012 and drilled the first well at Titas gas field in March 2013. The rig was trapped and Eriell has failed to recover the rig from Titas well no. 20. At present, it is trying to pull it out through a side track drilling.
The Petrobangla chairman pointed out that Eriell was supposed to drill four wells in the meantime, but has failed to complete even a single one.
He explained that the government signed a state-to-state deal with Gazprom so that the job could be carried out within the stipulated time for implementing its robust fast-track initiative, to develop the gas sector. “Unfortunately, they engaged an inexperienced driller here. So we won’t get the expected results from the so-called initiative within the relevant time-frame.”
The government engaged Gazprom to drill four wells in Titas gas field: one in Rashidpur gas field, two in Shahbazpur, and one in Semutang, Begumganj and Srikail, each. The aim was to add 300 mmcf of gas, so that the country would be able to mitigate the nagging problems of power and gas supply.
In October 2010, Gazprom offered to drill 10 onshore gas wells on a turnkey basis, at a total cost of USD 197.55 million, with drilling to be completed within 18 months of the approval being granted. It agreed to pay 5 per cent of the total cost as a performance guarantee, but did not agree to pay any compensation for any accident.
The cabinet purchase committee, on December 2010, approved the proposal of the energy ministry to appoint Russia’s Gazprom to drill 10 gas wells across the country, without any tender, under the Emergency Power and Energy Supply Act, which allows this.
Petrobangla had a target to supply 30 mmcfd gas from the well by June, but, now, that has been delayed, BGFCL’s managing director, Md Shafiqur Rahman, said.
Again, BGFCL and Gazprom are yet to sign any deal regarding insurance. “We asked the company to complete the insurance-related tasks. However, we have written to the company and, hopefully, we will be able to sign the deal soon,” the MD said.
Titas is now supplying around 750 mmcfd of gas from its 15 wells. It would add another 20 mmcfd of gas, after commissioning well no. 17 next week.

-With The Independent input

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