Natural Gas and Its Future Utilization in Bangladesh
Introduction
India and Myanmar have attracted considerable interest from international oil and gas companies (IOCs) in recent years following a number of significant discoveries in the Bay of Bengal. Now it appears that Bangladesh is ready to tempt the worldwide petroleum industry into investigating the untapped gas potential of its offshore acreage. The country is preparing to launch its Third Licensing Round towards the end of the year, after the Bangladesh High Court in July 2006 partially vacated an injunction on the signature of Production Sharing Contracts (PSCs) with foreign companies.
Background
Bangladesh is one of the world's poorest and most densely populated countries. Not only is it highly vulnerable to natural disasters such as cyclones, flooding and drought, it is also associated with civil unrest, political instability and widespread corruption all of which can be viewed as a deterrent to the country's attractiveness as an E&P destination.
Natural gas is the only significant source of commercial energy, and accounts for almost 75% of commercial energy consumption. The largest gas consumers are the power and fertilizer industries, which account for around 70% of daily production. Current supply capacity of 1,450 MMcf/d, however, is insufficient to meet the projected growth in demand; gas consumption, currently at 1,400 MMcf/d, is expected to grow at a rate of 10% per annum.
Some 23 onshore / offshore exploration blocks were delineated ahead of the First Licensing Round in 1993. Six PSCs were awarded in the round:
Cairn Energy-Holland Sea Search,
Occidental,
Okland-Rexwood,
United Meridian Corporation.
A highly protracted Second Licensing Round was launched in 1997, and a further four PSCs were eventually awarded to
Shell-Cairn Energy - Bapex,
Tullow-Chevron Texaco - Bapex,
Unocal-Bapex.
Although many of these companies have subsequently left, following a
India and Myanmar have attracted considerable interest from international oil and gas companies (IOCs) in recent years following a number of significant discoveries in the Bay of Bengal. Now it appears that Bangladesh is ready to tempt the worldwide petroleum industry into investigating the untapped gas potential of its offshore acreage. The country is preparing to launch its Third Licensing Round towards the end of the year, after the Bangladesh High Court in July 2006 partially vacated an injunction on the signature of Production Sharing Contracts (PSCs) with foreign companies.
Background
Bangladesh is one of the world's poorest and most densely populated countries. Not only is it highly vulnerable to natural disasters such as cyclones, flooding and drought, it is also associated with civil unrest, political instability and widespread corruption all of which can be viewed as a deterrent to the country's attractiveness as an E&P destination.
Natural gas is the only significant source of commercial energy, and accounts for almost 75% of commercial energy consumption. The largest gas consumers are the power and fertilizer industries, which account for around 70% of daily production. Current supply capacity of 1,450 MMcf/d, however, is insufficient to meet the projected growth in demand; gas consumption, currently at 1,400 MMcf/d, is expected to grow at a rate of 10% per annum.
Some 23 onshore / offshore exploration blocks were delineated ahead of the First Licensing Round in 1993. Six PSCs were awarded in the round:
Cairn Energy-Holland Sea Search,
Occidental,
Okland-Rexwood,
United Meridian Corporation.
A highly protracted Second Licensing Round was launched in 1997, and a further four PSCs were eventually awarded to
Shell-Cairn Energy - Bapex,
Tullow-Chevron Texaco - Bapex,
Unocal-Bapex.
Although many of these companies have subsequently left, following a