Chevron Bangladesh has confirmed that it will not be proceeding with an agreement to sell its shares in Bangladesh to a Chinese consortium, overturning a decision to quit the country.
The US oil and gas giant had announced in April that its Bangladesh subsidiaries would be sold to Chinese firm Himalaya Energy Co Ltd.
On Sunday, Chevron Bangladesh Communications Manager (External Affairs) Shaikh Jahidur Rahman told the Dhaka Tribune that Chevron Corporation has confirmed that its wholly-owned subsidiary, Chevron Global Ventures, Ltd, will not be moving ahead with an agreement to sell the shares of its wholly-owned indirect subsidiaries operating in Bangladesh to Himalaya Energy.
“Chevron has decided to retain its assets in Bangladesh and will continue to work with Petrobangla and the Government of Bangladesh in a bid to provide reliable and affordable energy to the nation,” he said.
On October 18, the Dhaka Tribune had published a report, titled ‘Chevron now wants to stay in Bangladesh, but under new terms‘, which said the subsidiary of the US-based oil giant had overturned a decision taken five months ago to quit the country.
Chevron Bangladesh has finally agreed to continue their operation in Bangladesh after negotiations with the Petrobangla chairman and other higher-ups.
Besides, the government’s unwillingness to allow Chevron to close its business here has also led the energy giant to make the decision.
State Minister for Power, Energy and Mineral Resources Nasrul Hamid also confirmed that Chevron is staying when talking to the reporters at Bidyut Bhaban in Dhaka on October 26.
Chevron’s decision was comfortable for the government, and the company trusts the government too, he added.
The state minister added that Chevron wants to set up new compressors at the Bibiyana gas field and that would cost $400 million. The matter was disclosed after Chevron submitted an official proposal.
On April 24, 2017, Chevron had announced that its wholly-owned subsidiary, Chevron Global Ventures Ltd, has entered into an agreement to sell the shares of its wholly-owned indirect subsidiaries operating in Bangladesh to Himalaya Energy, which is owned by Chinese consortium China ZhenHua Oil.
Chevron had planned to close the sale, part of non-core asset disposals, around mid-October.
However, Bangladesh government did not approve of Chevron’s call right away as it originally wanted to buy the shares itself, stalling the whole process. The government holds the right of first refusal in any asset sale.
Chevron, the largest foreign investor and gas producer in Bangladesh, operates under a production sharing contract at the Bibiyana gas field’s Block 12, and in blocks 13 and 14 of Jalalabad and Moulvibazar fields.
The onshore gas fields have an average net daily output of 720 million cubic feet of gas and 3,000 barrels of condensate, or liquid hydrocarbon produced with gas. Chevron sells the entire output to Petrobangla under a long-term sales agreement.