The Financial Express
Swasti Lankabangla Swasti Lankabangla

Hydrocarbon exploration: Last call for final deal on JV survey

| Updated: October 21, 2019 18:40:28

Representational photo shows a gas rig operated by Diamond Resources and contracted to Cairn Energy plc, about 15 miles off Chattogram in the Bay of Bengal. Courtesy: Jiri Rezac Representational photo shows a gas rig operated by Diamond Resources and contracted to Cairn Energy plc, about 15 miles off Chattogram in the Bay of Bengal. Courtesy: Jiri Rezac

Petrobangla has invited again the Norwegian-US joint venture (JV) to ink a final deal to carry out a survey to delineate hydrocarbon reserves in the Bay of Bengal.

This is the final call for the TGS-Schlumberger JV to do the deal on the long-awaited multi-client seismic survey, said a senior official of the state entity.

Petrobangla might terminate the ongoing talks with the firm if it does not respond to the offer of a final deal for the same, he observed.

Earlier in May, the national oil, gas and mineral corporation invited the JV to sign it and initiate the survey in offshore areas.

Instead, the firm requested Petrobangla to invite and discuss the model production-sharing contract (MPSC) with a dozen of international oil and companies (IOCs) and have their feedback on MPSC.

Last month, Petrobangla completed talks with IOCs in line with the request and is waiting to ink the deal.

Officials said Norwegian seismic specialist TGS and US oilfield service Schlumberger are currently involved in such a seismic project in the Gulf of Mexico.

The JV was selected for the job twice following two separate competitive biddings floated back in 2015.

The initial bid in early 2015 was cancelled and the subsequent bidding in late 2015 has been held up in the past three-and-a-half years.

Sources said the TGS-Schlumberger JV had arranged a couple of dedicated ships to do the job at that time.

But it had to cancel deals with shippers as Bangladesh has shelved the project over the past several years.

However, the cabinet committee on economic affairs in the April 24 meeting approved the awarding of the job to the joint venture.

Sources said the project is expected to survey 22 offshore hydrocarbon blocks within the sovereign territory of Bangladesh.

The blocks cover 81,000-square kilometres having depth ranging from 20 metres to 2,500 metres in the Bay.

On completion of the survey, Petrobangla plans to provide interested IOCs with the non-exclusive multi-client seismic data of the blocks.

The aim is to help the companies carry out basin evaluation, prospect generation and participation in the bidding for exploration.

The surveyors would not receive payments for their work, to be done in two years, from Petrobangla as per the bidding terms.

It would be free to sell the seismic data to the interested IOCs for the next eight years.

The TGS-Schlumberger, however, would have to share data and profits with Petrobangla.

Officials said Bangladesh has never carried out such a multi-client seismic survey in any offshore block.

It earlier floated multiple international tenders to explore oil and gas both onshore and offshore by IOCs.

The bid winners conducted surveys in their respective blocks before initiating oil and gas exploration.

The country's offshore areas are now well-demarcated following verdicts by international courts.

It has territorial rights of up to 200 nautical miles from shore as exclusive economic zone in the Bay.

Besides, it has free access to around 387 nautical miles into deep sea following demarcation of maritime boundary by the International Court of Arbitration.

There is potential for hydrocarbon deposits in Bangladesh's maritime territory as both India and Myanmar have already discovered huge gas in the Bay.

Petrobangla floated offshore bidding rounds without any survey in 2008, 2012 and 2016.

Only a few IOCs participated in the bidding and production-sharing contracts could be inked only for four blocks.



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