Bapex is looking to sign a joint venture agreement with an international consortium to carry out exploration and development of four onshore geological structures.

Through this, the government is once again giving international oil companies a chance to explore for onshore gas in Bangladesh.

The move comes after the High Court recently disposed of a previous stay order on allowing international oil companies to explore onshore gas blocks.

“Bangladesh does not have the funds or technical capacity to explore these structures. So we invited expressions of interest (EoI) and request for proposal (RFP) aiming to explore oil and gas from reputed international oil and gas companies to explore and develop four potential onshore gas structures in gas block 22, in the greater Chittagong region,” Bapex Managing Director Md Atiquzzaman told the Dhaka Tribune yesterday.

A consortium of China-based Geo-Jade Petroleum Corporation, Canada-based Longhorn Oil & Gas Ltd and Chinese Sinopec has already been selected for the joint venture agreement, he said.

“We hope that we will sign the contract soon,” added the MD of state-owned Bangladesh Petroleum Exploration and Production Company Limited (Bapex).

Earlier, Bapex invited EoIs from international oil companies to explore a number of well-defined four-way anticline closures – Patiya, Jaldi, Kasalong and Sitapahar – situated in Chittagong and the Chittagong Hill Tracts.

Several companies submitted proposals, and of those, Bapex selected four companies and eventually selected one consortium.

Sources said the RFP stipulates that until production begins, the company partnering with Bapex would bear sole responsibility for mishaps and the costs of correcting them.

Bapex will not spend any money during the exploration phase. The joint venture between Bapex and the selected firm will come into effect during the production phase, with Bapex taking 30-35% of revenues.

Bapex currently has just one joint venture with Canadian Niko Resources. Together, they developed Feni Gas Field, but production has been suspended because of a payment dispute. They also undertook drilling at Chhatak.

In 2010, Niko filed a lawsuit with International Centre for the Settlement of Investment Disputes (ICSID), against the Bangladesh government, Petrobangla and Bapex after Petrobangla withheld payments on gas sales from Feni gas field from 2006.

It filed another case involving two blowouts at Chattak gas field in 2005 after a Bangladeshi court held Niko liable for the accident.

The proceedings of the trial are still pending.

The country’s lone state-owned oil and gas exploration firm has so far discovered seven gas fields – Saldanadi, Fenchuganj, Shahbazpur, Semutung, Sundalpur, Srikail and Rupganj. 

- See more at: https://www.dhakatribune.com/bangladesh/2016/may/18/bapex-sign-deal-international-consortium#sthash.PJc212eW.dpuf