Gas exploration

Bangladesh to dig wells near Myanmar border

For the first time, Bangladesh is going to dig two exploration wells at two prospects in shallow sea near the Myanmar maritime border. The two wells—Shimanto and Palongki—will be dug by the Australian company Santos in Block SS-11 in the Bay of Bengal within this year.

Earlier, Santos, under a joint venture (JV) with Singapore’s KrisEnergy, carried out a 3D seismic survey in Block SS-11, covering some 305 square-kilometre area in shallow waters to explore the hydrocarbon potential.

In 2017, Santos and Kris had carried out a 2D seismic survey in 3,220 LKM (line kilometre) areas and identified seven prospects which wooed the JV to carry out the 3D seismic survey later on.

The joint venture of Santos and Kris was committed to drilling an exploration well by conducting a 2D seismic survey in 3,220LKM area, a 3D survey in 300 sq km and offering a bank guarantee of USD 15 million for exploring SS-11 during the initial five years of the PSC starting from 2016.

Talking with The Independent, Mahbub Sarwar, a former director of the Production Sharing Contact (PSC) of Petrobangla, said the shallow Block SS-11 is located near the Myanmar maritime blocks of A-6 and AD-7—both of which have proven reserves.

Last year, Australia’s Woodside found gas in the Pyi Thit-1 exploration well in Block A-6 in the Southern Rakhine Basin near the maritime border of Bangladesh. The company struck a gross gas column of approximately 65 meters in A-6.

Earlier, Woodside discovered gas at the Thalin-1A exploration well in the deepwater Block AD-7 in the Rakhine Basin. The company intersected a gross gas column of approximately 64 meters while drilling the Thalin-1A well.

Though there is a maritime border between Bangladesh and Myanmar, the sea basin is the same. So, it was logical to assume that SS-11 on the Bangladesh side has gas, said Sarwar.

Another Petrobangla official said Santos would conduct explorations in Shimanto this year and in Palongki next year.

Prof. Badrul Imam, an energy expert, told The Independent that he had long been hopeful about the prospects in the Bay of Bengal. “I believe the five or six structures identified along Myanmar’s three gas fields having 8 TCF of gas,” he added.

He said that it was now believed that the maritime boundary area between Bangladesh and Myanmar held the most prospective oil and gas structures among all the offshore blocks of both countries. So, the next big discoveries in the Bay of Bengal are likely to take place there, he added.

“Should a single gas discovery fall on both sides of the boundary, the country that drills there first would get the most benefits from it as the underground oil or gas pool is blind to any geographic boundary," Prof. Imam said.

The PSC in Bangladesh allows the joint-venture firm the right to full repatriation of profits and not pay any signature bonus or royalty on equipment and machinery imported for exploration, development and production. Companies will also have 100 per cent cost recovery.

The contractor can also sell gas directly to third parties subject to Petrobangla's right of first refusal. But hydrocarbons produced from the shallow water blocks must be sold in the domestic market as exports are prohibited under PSCs.

Petrobangla's subsidiary, Bapex, will have 10 per cent carried interest in the shallow water block.

Currently, Bangladesh is entirely dependent on onshore fields for natural gas output, with current production hovering around 2,700 million cubic feet per day (mmcfd) compared with the demand for more than 3,300 mmcfd.

Gas exploration

Bangladesh to dig wells near Myanmar border

For the first time, Bangladesh is going to dig two exploration wells at two prospects in shallow sea near the Myanmar maritime border. The two wellsShimanto and Palongkiwill be dug by the Australian company Santos in Block SS-11 in the Bay of Bengal within this year. Earlier, Santos, under a joint venture (JV) with Singapores KrisEnergy, carried out a 3D seismic survey in Block SS-11, covering some 305 square-kilometre area in shallow waters to explore the hydrocarbon potential. In 2017, Santos and Kris had carried out a 2D seismic survey in 3,220 LKM (line kilometre) areas and identified seven prospects which wooed the JV to carry out the 3D seismic survey later on. The joint venture of Santos and Kris was committed to drilling an exploration well by conducting a 2D seismic survey in 3,220LKM area, a 3D survey in 300 sq km and offering a bank guarantee of USD 15 million for exploring SS-11 during the initial five years of the PSC starting from 2016. Talking with The Independent, Mahbub Sarwar, a former director of the Production Sharing Contact (PSC) of Petrobangla, said the shallow Block SS-11 is located near the Myanmar maritime blocks of A-6 and AD-7both of which have proven reserves. Last year, Australias Woodside found gas in the Pyi Thit-1 exploration well in Block A-6 in the Southern Rakhine Basin near the maritime border of Bangladesh. The company struck a gross gas column of approximately 65 meters in A-6. Earlier, Woodside discovered gas at the Thalin-1A exploration well in the deepwater Block AD-7 in the Rakhine Basin. The company intersected a gross gas column of approximately 64 meters while drilling the Thalin-1A well. Though there is a maritime border between Bangladesh and Myanmar, the sea basin is the same. So, it was logical to assume that SS-11 on the Bangladesh side has gas, said Sarwar. Another Petrobangla official said Santos would conduct explorations in Shimanto this year and in Palongki next year. Prof. Badrul Imam, an energy expert, told The Independent that he had long been hopeful about the prospects in the Bay of Bengal. I believe the five or six structures identified along Myanmars three gas fields having 8 TCF of gas, he added. He said that it was now believed that the maritime boundary area between Bangladesh and Myanmar held the most prospective oil and gas structures among all the offshore blocks of both countries. So, the next big discoveries in the Bay of Bengal are likely to take place there, he added. Should a single gas discovery fall on both sides of the boundary, the country that drills there first would get the most benefits from it as the underground oil or gas pool is blind to any geographic boundary, Prof. Imam said. The PSC in Bangladesh allows the joint-venture firm the right to full repatriation of profits and not pay any signature bonus or royalty on equipment and machinery imported for exploration, development and production. Companies will also have 100 per cent cost recovery. The contractor can also sell gas directly to third parties subject to Petrobanglas right of first refusal. But hydrocarbons produced from the shallow water blocks must be sold in the domestic market as exports are prohibited under PSCs. Petrobanglas subsidiary, Bapex, will have 10 per cent carried interest in the shallow water block. Currently, Bangladesh is entirely dependent on onshore fields for natural gas output, with current production hovering around 2,700 million cubic feet per day (mmcfd) compared with the demand for more than 3,300 mmcfd.