The government eyes launching a new bidding round within the next couple of months as the draft of a new model production sharing contract (PSC) is awaiting final approval, said officials.
State-run Petrobangla has drafted the model PSC and sent it to the cabinet committee on economic affairs through the energy ministry for final approval, a senior Petrobangla official said.
"We are expecting to get the endorsement within a month and launch the bidding round within one month of getting approval," he said preferring anonymity.
The model PSC has been drafted incorporating a new pricing formula of natural gas and oil aiming to lure international oil companies (IOCs) into carrying out energy exploration in both onshore and offshore blocks, the official said.
The discovery of new hydrocarbon reserves will be the key focus of the new bidding round as the country will start supplying expensive re-gasified LNG (liquefied natural gas) to consumers from the early next month.
The discovery of any fresh hydrocarbon reserves will help reduce dependence on import of the expensive LNG.
Petrobangla has accommodated recommendations from a New Zealand-based international consultant while drafting the PSC as the country's previous several bidding rounds saw lukewarm response from the IOCs.
Many IOCs did not take part in the offshore bidding rounds in 2008, 2012 and 2016 only due to 'inadequate' fiscal terms.
Only a handful of IOCs took part in the bidding and subsequently inked PSCs in 2008 and 2012.
Only one IOC submitted finally the request for proposal (RfP) under the 2016 bidding round and signed PSC only for one deep water block out of three that were up for grabs.
The US-based oil and gas giant ConocoPhillips shut operations and left exploration rights to two separate deepwater blocks-DS-08-10 and DS-08-11-on December 15, 2014 after carrying out 2D seismic surveys due to 'poor' fiscal terms.
The same firm in April, 2013 also backed out of a deal on the shallow-water block SS-07 as the fiscal terms were deemed not supportive for it.
The US firm was awarded the shallow water block in the 2012 bidding round.
The country currently has a total of 26 offshore blocks, of which 15 are located in deep sea and 11 are in shallow water blocks.
Five IOCs have PSCs either individually or under joint venture to explore three shallow water blocks and one deep water blocks.
ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) are jointly exploring shallow water block SS-04 and SS-09.
The joint venture of Santos and Kris Energy is exploring shallow water block SS-11.
POSCO Daewoo Corporation has exploration contract to discover hydrocarbon in deep water block DS-12.
The country had not offered any onshore oil and gas blocks since 1997.
The country is currently dependent on onshore fields for its entire natural gas output.
Gas production at present is around 2,700 million cubic feet per day (mmcfd) against the demand for over 3,300 mmcfd.
The short supply of energy has pushed the government to ration gas supplies to industries, power plants and fertiliser factories for around a decade.