CAPITAL: Dhaka
MONETARY UNIT: Taka
REFINING CAPACITY: 31,200 b/cd
OIL PRODUCTION: 1,600 b/d
OIL RESERVES: 5.4 million bbl
GAS RESERVES: 10.9 tcf
Bangladesh in mid-1997 accepted bids in the second exploration round organized by the government and state-owned oil company Petrobangla.
Industry interest was reported to be high as the country headed into what was expected to be a period of relative political stability. The government of Prime Minister Sheikh Hasina Wajed, formed after parliamentary elections in 1996, was considered moderate and focused on economic expansion.
A series of mostly gas discoveries in the 1990s had raised Bangladesh`s geologic allure.
Cairn Energy plc, for example, was appraising its 1996 Sangu discovery offshore and held rights to develop the Kutubdia discovery in the same permit area.
Cairn farmed out 50% of its Bangladesh interests to Royal Dutch/Shell, a long-time operator in the country. Shell considered the country a possible site for use of its proprietary gas-to-liquids processing technology.
It was reported to have proposed investment of as much as $2.5 billion in a plant to produce up to 50,000 b/d of middle distillate from about 400 MMcfd of natural gas.
In other action, the government started first-phase work for the Lakatura natural gas processing complex at Sylhet in the northeast. The complex was to dehydrate and extract liquids from gas produced from Jalalabad field.
Occidental Petroleum Corp. transferred a 50% interest in blocks containing the field to Unocal Corp. in 1997. The companies planned to start production in mid-1998 and conduct further exploration.
New model contract
In its exploration licensing round, Bangladesh offered three offshore and 12 onshore blocks to companies permitted to bid alone or with others for one or more blocks.
A new model production sharing contract provided for repatriation of profits, required no signature bonus, and imposed neither a duty on exploration and production equipment and machinery nor corporation tax or administration fee. Companies could export gas as LNG subject to a Petrobangla right of first refusal.
