PSC will be finalized in current month
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Photo: Collected
Dhaka,(Barta24.com): The Energy division wants to finalize the draft amendment of model Production Sharing Contract (PSC). Petrobangla chairman has said that this will help to increase opportunities including enhancement of the price of gas.
The Power, Energy and Mineral Resources ministry has given an indication that after examining the PSC of India and Myanmar the rate would be made competitive. A high official of the ministry told Barta24.com on condition of anonymity that our gas price in PSC is less than India and Myanmar. So we did not get response though we floated tenders. For that reason there is an active consideration to enhance the gas price. Besides, the Petrobangla has been given instruction how the PSC can be made more competitive and attractive.
The gas blocks of Bangladesh, Myanmar and India are located in the same zone of Bay of Bengal. As our gas price is less than Myanmar, so the foreign companies are not responding. So initiatives are underway to enhance the gas price. If the draft PSC is approved then it will be sent to the cabinet for vetting. We expect to get it approved within one to one and half months time, the source said.
According to model PSC of 2012 there was an agreement with Konoka Phillips. At that time the gas price was fixed at the rate of 4.16 dollars for one thousand cubic feet while the gas price of Myanmar is 7 dollars creating disinterest of foreign companies. These are being publicized by the Energy division and Petrobangla all through.
Many quarters cannot agree with the ideas of Petrobangla. Former director (Mining) Mokbul e Ilahi Chowdhury told Barta24.com that I cannot agree with the proposition that the foreign companies will jump on it if the gas price is increased. According to him to make open the information and data about gas blocks is very much urgent. If the foreign companies do not know about our reserve in the sea why they will be interested. We should supply our available information free of cost or at minimum cost to them.
The investors will be interested when they come to know that we have enough reserve in the sea. If not, in spite of gas price increase they will not invest in gas exploration. So we must take firm policy matter decision in this regard whether we will open the information to them, said Mokbul -e- Ilahi Chowdhury.
Energy expert Professor Shamshul Alam told Myanmar sells out their total gas. So Myanmar is interested to earn maximum by increasing the gas price. But I do not find any logic that by enhancing gas price we will use the whole lot for our domestic consumption. Their idea of enhancing gas price is suicidal.
Shamshul Alam told that there is a vicious circle in energy sector who wants to increase the gas price to such a level that it becomes equal to imported gas. To justify the import, the vicious circle led by Energy Adviser Towfiq -e- Ilahi Chowdhury has broken the backbone of energy sector. So that the import of LNG can be continued on long term basis. It is sarcastic that if we produce power in our country the cost is high, so the power is imported. In energy sector the same situation is being created.
Sea disputes with Myanmar and India were solved in 2012 and 2014 respectively. This helped Bangladesh to establish rights on 1 lakh 19 thousand square kilometers. The sea zone of Bangladesh have been divided into 11 shallow and 15 deep blocks totaling 26 blocks.
Only three contracts in shallow and one contract in deep sea were signed. But Myanmar is withdrawing gas from our nearby blocks. We are not getting any response despite our repeated tender calls. On that argument the PSC is going to be amended.
Gas reserve in the land is going to be exhausted gradually. To face the crisis LNG is being imported at a very high price. There is allegation that if the gas exploration could be done in time then the crisis could not crop up.
Power, Energy and Mineral resources State Minister Nasrul Hamid Bipu addressing a seminar told that we could not achieve success in gas sector as we did in power sector. Due to want of skilled man power the energy sector is lagging behind. Now no one’s failure will be spared, he added.
