Bapex to sign joint venture deal with IOCs

Exploring cht gas reserves

The state-owned Bangladesh Petroleum Exploration and Production Co. Ltd (Bapex) is all set to sign a joint venture (JV) deal with international oil companies (IOCs) to explore oil and gas prospects in the Chittagong Hill Tracts (CHT).
The government is once again giving IOCs a chance to look for onshore gas in Bangladesh. The move came after the High Court (HC) recently disposed of a stay order on allowing IOCs to explore onshore gas blocks.
Bapex managing director Md Atiquzzaman told The Independent yesterday signing a joint venture agreement with IOCs for exploration work was not an easy task. “Most of the vetting work has been done. We are waiting for the home ministry’s approval,” he added.
To explore and develop the four potential onshore gas structures in Block 22 of CHT—Patiya, Jaldi, Kasalong, and Sitapahar—Bapex had earlier invited expressions of interest and requests for proposal from reputable IOCs, he said. Atiquzzaman added that a consortium of China-based Geo-Jade Petroleum Corporation, Canada-based Longhorn Oil & Gas Ltd and Chinese Sinopec has been selected for the JV.
About the potential agreement, the Bapex MD said that till production begins, the partner would bear sole responsibility for accidents and the costs of correcting them. Bapex will not spend any money during the exploration phase. The JV will come into effect during the production phase, with Bapex earning 30–35 per cent of the revenues.
Explaining the decision to go for a JV, Atiquzzaman said Bangladesh does not have the funds or technical capacity to explore in the complex geological structures of CHT.
However, Prof. Dr Badrul Imam, professor of the department of geology in Dhaka University, claimed that Bapex has expertise to explore Patiya and Jaldi. “I don’t see any point going for a JV with IOCs to explore in those regions. Bapex has enough expertise to drill around those geological formations,” he said.
Prof. Imam said that Pakistan Petroleum Ltd had drilled a well in Patiya along the Cox’s Bazar coast in 1953. However, the result had not been positive. Nor did European energy giant Cairn Energy get much success by drilling three wells in Jaldi. “However, initial estimation suggests that there are huge prospects in those areas,” he added.
About the geological structures in Kasalong and Sitapahar, he said that those are complex and a JV is needed there. “Some drilling done in those areas in the 1960s had proved the presence of oil and gas, but the work did not progress much,” he said.

In 1910, the Indian Petroleum Prospecting Company first drilled an exploratory well in this part of the then British India. The well was drilled in Sitakundu. However, the mission was unsuccessful.
The IPPC drilled four wells until 1914, without any luck. Seventy-five years later, Petrobangla drilled the fifth well. Again, the result was negative.
In 1993, Petrobangla awarded United Meridian Block 22, comprising the three hill districts of Rangamati, Khagrachhari and Bandarban. It conducted a survey, but did not drill, as there was no compulsion for Petrobangla to buy any discovered gas.
They wound up operations from Bangladesh in 2000. The block was handed over to Ocean Energy, which also carried out some surveys, but did not drill. They had applied to Petrobangla for an extension, but the petition was not entertained. They also left Bangladesh in 2004. Since then, no exploration has been done in CHT.
“I still believe there are some large gas reserves in those areas. A systematic exploration will unearth those,” said Prof. Imam.

Bapex to sign joint venture deal with IOCs

Exploring cht gas reserves

The state-owned Bangladesh Petroleum Exploration and Production Co. Ltd (Bapex) is all set to sign a joint venture (JV) deal with international oil companies (IOCs) to explore oil and gas prospects in the Chittagong Hill Tracts (CHT). The government is once again giving IOCs a chance to look for onshore gas in Bangladesh. The move came after the High Court (HC) recently disposed of a stay order on allowing IOCs to explore onshore gas blocks. Bapex managing director Md Atiquzzaman told The Independent yesterday signing a joint venture agreement with IOCs for exploration work was not an easy task. Most of the vetting work has been done. We are waiting for the home ministrys approval, he added. To explore and develop the four potential onshore gas structures in Block 22 of CHTPatiya, Jaldi, Kasalong, and SitapaharBapex had earlier invited expressions of interest and requests for proposal from reputable IOCs, he said. Atiquzzaman added that a consortium of China-based Geo-Jade Petroleum Corporation, Canada-based Longhorn Oil Gas Ltd and Chinese Sinopec has been selected for the JV. About the potential agreement, the Bapex MD said that till production begins, the partner would bear sole responsibility for accidents and the costs of correcting them. Bapex will not spend any money during the exploration phase. The JV will come into effect during the production phase, with Bapex earning 3035 per cent of the revenues. Explaining the decision to go for a JV, Atiquzzaman said Bangladesh does not have the funds or technical capacity to explore in the complex geological structures of CHT. However, Prof. Dr Badrul Imam, professor of the department of geology in Dhaka University, claimed that Bapex has expertise to explore Patiya and Jaldi. I dont see any point going for a JV with IOCs to explore in those regions. Bapex has enough expertise to drill around those geological formations, he said. Prof. Imam said that Pakistan Petroleum Ltd had drilled a well in Patiya along the Coxs Bazar coast in 1953. However, the result had not been positive. Nor did European energy giant Cairn Energy get much success by drilling three wells in Jaldi. However, initial estimation suggests that there are huge prospects in those areas, he added. About the geological structures in Kasalong and Sitapahar, he said that those are complex and a JV is needed there. Some drilling done in those areas in the 1960s had proved the presence of oil and gas, but the work did not progress much, he said. In 1910, the Indian Petroleum Prospecting Company first drilled an exploratory well in this part of the then British India. The well was drilled in Sitakundu. However, the mission was unsuccessful. The IPPC drilled four wells until 1914, without any luck. Seventy-five years later, Petrobangla drilled the fifth well. Again, the result was negative. In 1993, Petrobangla awarded United Meridian Block 22, comprising the three hill districts of Rangamati, Khagrachhari and Bandarban. It conducted a survey, but did not drill, as there was no compulsion for Petrobangla to buy any discovered gas. They wound up operations from Bangladesh in 2000. The block was handed over to Ocean Energy, which also carried out some surveys, but did not drill. They had applied to Petrobangla for an extension, but the petition was not entertained. They also left Bangladesh in 2004. Since then, no exploration has been done in CHT. I still believe there are some large gas reserves in those areas. A systematic exploration will unearth those, said Prof. Imam.