BD likely to allow Chevron to explore some onshore blocks

M Azizur Rahman | Monday, 19 August 2019

The government may allow US company Chevron to carry out exploration study in some onshore blocks to find out new natural gas prospects.

"We are considering Chevron's proposal positively. A positive decision is expected to come soon," said a senior Petrobangla official, adding that the company would not be provided with all the blocks it wanted for the study.

He, however, couldn't say which blocks would be awarded to the company.

The US firm recently sent a proposal to Petrobangla as well as the Energy and Mineral Resources Division to explore 11 onshore blocks, fully or partially, to delineate new hydrocarbon prospects and help augment the country's overall natural gas output.

Chevron intends to perform the study outside the purview of its existing PSCs (production sharing contracts) with the Petrobangla and the government for exploration in three onshore gas fields - Bibiyana, Jalalabad and Maulavi Bazar.

This proposal is Chevron's first working programme in the country since October 2017, when it withdrew its decision to leave the country.

Chevron then had assured the government of investing around US$ 400 million afresh in oil and gas exploration and development and build two compression stations at Bibiyana and Jalalabad gas fields respectively, said the Petrobangla official.

But the company neither did fresh investment nor it advanced with its compression stations installation plan, he added. Petrobangla rather extended the PSC tenures of two Chevron's blocks.

Officials said the US company in its recent proposal aims at finding potentially drillable prospects in the unexplored areas of the 11 blocks (1, 2A, 2B, 3A, 3B, 8, 9, 11, 12, 13 and 14).

Among the blocks, few are still vacant or unexplored, some owned by state-run Bangladesh Gas Fields Company Ltd (BGFCL) and Sylhet Gas Fields Ltd (SGFL) and some owned by Chevron Bangladesh itself.

Chevron also seeks access to relevant data currently available with the BGFCL, SGFL and Bangladesh Petroleum Exploration and Production Company Ltd (Bapex), and inking a confidentiality agreement.

It believes that it will be able to utilise its knowledge in reservoir 'stratography,' unconventional reservoir 'facies', a senior Petrobangla official told the FE.

Assigned by Bapex, Chinese energy exploration firm Sinopec, however, found recently an onshore natural gas prospect at Shariatpur.

Drilling of exploratory wells will be required to assess whether gas reserves there will be commercially viable or not.

In its proposal, Chevron expressed the interest to carry out the study excluding the 'ring-fenced areas' of the blocks owned by the BGFCL and the SGFL.

A ring-fence is a virtual barrier that segregates a portion of company's assets from the rest, which is kept intake for future exploration.

Chevron also aims at further exploration study in the 'relinquished areas', in all the three of its blocks, which it surrendered to Petrobangla earlier seeing 'poor' prospects there, said the official.

Natural gas output from Chevron-operated three onshore fields - Bibiyana, Jalalabad and Moulavi Bazar - was around 1,246 million cubic feet per day (mmcfd), which is around 55.23 per cent of the total gas produced from local gas fields to the tune of 2,256 mmcfd, according to Petrobangla statistics as on August 17.

The country's overall natural gas output is, however, around 2,774 mmcfd including the imported re-gasified LNG (liquefied natural gas) to the tune of around 518 mmcfd on Saturday.