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POST TIME: 5 September, 2018 00:00 00 AM
Govt considering underground gas storage at Sangu field
SHAHED SIDDIQUE

Govt considering underground gas storage at Sangu field

The government is examining a proposal to use the Sangu gas field as “underground gas storage” to ensure a higher level of energy security for the country. Experts, however, expressed scepticism about the efficacy of this initiative. Tawfiq-e-Elahi Chowdhury, energy adviser to the Prime Minister, recently instructed Petrobangla, the state-owned oil and gas corporation, to examine the proposal, which has been submitted by the US oil giant ExxonMobil.

Sources said a government team, headed by Tawfiq-e-Elahi Chowdhury, visited some locations to assess the possibility of having an underground gas storage. After these visits, Petrobangla arranged a meeting, attended by Tawfiq-e-Elahi Chowdhur and the energy secretary of the Enegy Division, Abu Hena Md Rahmatul Muneem.

Senior high officials of Petrobangla were also present in the meeting.

Government officials and policymakers discussed the prospect of a gas reserver at the Sangu gas field which was dried a few years ago. They said that with modran technology, the Sangu gas field can store up to 500 BCF of gas.

The only offshore gas field of Bangladesh stopped permanently in September 2013 due to its uncommercial level of

production. In 1996, Cairn Energy, a British oil company, discovered the Sangu gas field in the Bay of Bengal and started production in 1998.

Badrul Imam, an energy expert, told the Independent: “The field was stopped to produce gas five years before. At this movement, the field’s sand stones are not properly placed to preserve gas that will be injected from outside.”

“I don’t see anything logical in developing the field for preservation of gas. Where exactly the gas will be coming from? Why this kind of issue is being discussed at this moment?” he said.

“I know the US and a few other countries are using their vacant gas fields as reservers because they have huge money. But this technology is not appropriate for us,” he replied to a question.   

Before this, ExxonMobil proposed the government to set up a small liquefied natural gas (LNG) terminal by using mothballed offshore facilities at Sangu to meet the country’s growing demand for energy in the short term. Later, the government cancelled the proposal to set up an LNG terminal at Sangu.

Model PSC

The government will finalise the model production sharing contract (model PSC) with an option of exporting gas to international markets to invite a new round of international bidding for oil and gas exploration in the country’s offshore blocks sometime next year.  The issued was discussed in yesterday”s meeting held at Petrobangla.

Tawfiq-e-Elahi Chowdhury instructed the officials to finalise the model PSC by this month.

“We’ve been instructed to finalise the model PSC by this month. But we don’t know why this instruction has been given. Before the general election, the government will not call any international tender for bidding offshore blocks that are allocated for oil and gas exploration,” a government official told The Independent.

“But we have to follow the instruction given by the policymakers and accordingly change some things relating to pipeline constriction by the operators and the charges. But the buying price of gas at USD 6.50 per unit will remain the same,” he said.

In the new model PSC, the contractor will initially conduct a seismic survey within three years and complete the data analysis. Next, it will inform the government whether it wants to move further with its plan or leave the country.

Sources said that after settlement of the disputes with Myanmar and India, Bangladesh’s total number of gas blocks now stands at 48. Among these, there are 22 onshore blocks and 26 offshore blocks. Of these offshore blocks, 11 are shallow blocks and remaining 15 are deep sea blocks.

So far, Bangladesh made no major breakthrough in offshore gas exploration after settlement of maritime boundary disputes with Myanmar in March 2012 and with India in July 2014. It has only awarded four offshore blocks out of the total 22. Myanmar, in contrast, has awarded 26 blocks in its maritime area.

Officials said that in the four awarded offshore blocks, the shallow blocks SS-11, SS-04, SS-09 were awarded in the 2014 bidding round, while the only deep sea block DS-12 was awarded in 2017 under a special initiative.