Gas exploration imperatives

It is disconcerting to note that the government has been relying heavily on Liquefied Natural Gas (LNG) imports for years to power the local economy without giving much attention to exploring the untapped gas reserves in the country. Spending over $2 billion per annum in import cost for LNG weighs heavily on the economy and obviously further balloons the trade deficit. Instead of exploring gas reserves, the import-directed gas policy is bleeding the coffer. Despite repeated calls from energy experts, it appears that the policymakers are oblivious to exploring undiscovered gas reserves. More than half of the country’s electricity comes from natural gas. Although some power plants also run on heavy fuel oil and diesel, there is no way left for the government other than exploring untapped gas reserves both from offshore and onshore fields.

A report carried by this daily on Monday states that the public sector’s indifference towards its finding of more than 150 TCF (trillion cubic feet) gas and subsequent inaction to extract the large-scale reserves onshore is forcing the nation to spend crores. The government in a survey in 2011 found that more than 150 TCF of gas is likely to be stored onshore alone. At the current rate of gas being used in the country, if this gas could be extracted, it would meet the demand throughout the present century. An expert associated with the survey said the government has not taken into account the important information about natural gas, which, if tapped, could solve the gas crisis in the country.

In the wake of the huge demand for fuel, liquefied natural gas is being imported from abroad at high prices, thus leading to price spirals at regular intervals. An internationally renowned mining expert Prof Badrul Imam, Department of Geology, University of Dhaka, told The Business Post that multiple scientific surveys had revealed the possibility of substantial gas reserves from Bogura to the entire southern part of the country.

The current state of gas exploration is frustrating. Half of the potential places in eastern Bangladesh remain unexplored, as from the country’s 26 onshore gas fields, current output hovers around 2,700mmcfd against the demand for 3,300mmcfd. About 60 per cent of the gas produced daily is extracted from fields managed by international oil companies (IOC). In the past 12 years, only 18 exploration wells have been dug with the discovery of four gas fields, according to the Bangladesh Oil, Gas, and Mineral Corporation. The winning of over 20,000 square kilometers area in the Bay of Bengal caused Bangladesh to change its offshore map, dividing the area into 26 new blocks. Only three of the blocks are currently under active exploration with no discovery of proven gas reserve so far. A multi-client survey in the offshore area was not even conducted, which is the first step to attract foreign companies to the expensive business of gas exploration. Over the five decades since independence, Bangladesh drilled only about 100 wells, mostly onshore, whereas India drilled 545 wells in 2017–18 alone. The ambitious government project for drilling 108 wells between 2016 and 2021 ended up digging only eight wells so far. Four of the 18 wells dug since 2009 have been drilled by IOCs. Even these limited exploratory activities are often marred by corruption and irregularities.

Petrobangla floated the last bidding round in 2012 through which several shallow-water blocks and one deep-water block were awarded to contractors. But not a single exploratory has been drilled by the contractors until now. Petrobangla instead extended the tenure of PSCs for each of the contractors by two years each.

There is a huge potential of a large-scale presence of gas underground from Bogura to all southern and southeastern parts of the country including Sylhet. The government must empower the Petrobangla for large-scale exploration and excavation activities without further delay. The gas policy should shift its focus from import to local gas exploration.