No new companies have shown interests in exploring oil and gas in three deep sea blocks out in the Bay of Bengal even though two months have passed since the state-run Petrobangla re-invited tendersfrom the international oil company (IOCs).
During the first tender invitation, however, 16 international companies had bought tender documents. The bids would have to be submitted by January 12 next year.
Petrobangla Chairman Hossain Monsur, confirming that no new company has bought the tender papers, told the Dhaka Tribune: “Normally IOCs hold pre-bid meetings before submitting tenders, but this time it is not happening as the first sixteen companies, which bought tenders sat with us and asked to revise the production sharing contract (PSC). The revise has been done. So, pre-bid meeting is not necessary.” he said.
“We hope a number of companies will take part in the bidding for three blocks,” he said.
The 16 companies that had bought the tender documents were Statoil of Norway, Premier Oil of the UK, Shell, ConocoPhillips, Chevron, Anadarko Petroleum and ExxonMobil of the US, Australia-based Santos and Carnarvon, Singapore-based Kris Energy, China-based CNOOC and CNPC, India’s state-owned ONGC, Cairn India, TOTAL of France, and BAPCO of Bahrain.
Petrobangla earlier suspended the deep sea blocks’ bidding process, allegedly upon “requests” from interested IOCs.
The state-owned gas monopoly had first put 12 blocks out for international tender for exploration on December 17 last year, under “Bangladesh Offshore Bidding Round 2012.”
Out of the 12, nine blocks were in shallow sea while the rest were in deep sea, covering 51,589 and 10,041 square kilometres respectively.
In July, Prime Minister Sheikh Hasina, who is also in charge of the energy ministry, consented to an Energy and Mineral Resources Division proposal to amend the PSC for deep sea hydrocarbon blocks.
On September 3, the Cabinet Committee on Economic Affairs approved the energy ministry’s proposal to amend the PSC, after its failure to attract bidders for deep-sea oil and gas exploration.
The amendments would allow IOCs to sell around 50% of the gas produced to Petrobangla at $6.50 per Mcf (1,000 cubic feet).
Global oil giants will also be allowed to sell 50% of its share of gas to a third party inside Bangladesh. They could even sell off Petrobangla’s share, if the latter did not purchase it.
At present, there is no scope for exporting gas.
The prices of gas produced by IOCs from deep sea fields will increase by 2% annually while the IOCs have also been exempted from paying the transportation tariff of 4% for using Petrobangla’s transmission lines under the amended PSC, 2012.
Meanwhile, recovery limit has been raised to 70% from 55% of the produced oil and gas, while Petrobangla will have to pay 37.5% in corporate tax on behalf of IOCs.