No offshore survey this exploration season

FT ONLINE

The much-hyped offshore survey to discover new hydrocarbon reserves in the country's territorial water in the Bay of Bengal is set to miss the current exploration season due to delay in project approval.

State-owned Petrobangla has not yet got the 'go-ahead' to ink a final deal with TGS-Schlumberger which won the bid for carrying out a non-exclusive multi-client seismic survey in offshore Bangladesh, a senior Petrobangla official said on Monday.

If the approval is not given soon, he said, surveying offshore in the current offshore exploration season will not be possible. The offshore exploration season usually spans from October to March, he added.

The law ministry has already vetted positively awarding of the contract to the Norwegian-US joint venture TGS-Schlumberger.

The TGS-Schlumberger is expected to survey 22 offshore hydrocarbon blocks within the sovereign territory of Bangladesh.

The blocks cover 81,000 square kilometres having the depth ranging from 20 metres to 2,500 metres in the Bay.

On completion of the survey, the JV company will be able to sell the seismic data to interested IOCs.

It will help the companies carry out basin evaluation, prospect generation and participation in the bidding for exploration.

The JV company will not receive payments for their work, to be done in two years, from Petrobangla as per the bidding terms.

It would be free to sell the seismic data to the interested IOCs for the next eight years.

The TGS-Schlumberger, however, would have to share the data and profits with Petrobangla.

The JV surveying company was selected to carry out the job twice following two separate competitive biddings floated back in 2015.

The initial bid in early 2015 was cancelled and the subsequent bidding in late 2015 has been held up for the past three and a half years.

However, the cabinet committee on economic affairs in the April 24 meeting approved awarding the job to the JV around three and a half years after its selection in late 2015 bidding.

This delay in awarding the job for carrying out the seismic survey has kept launching of the much-needed offshore exploration pending and thus prompted import of 'expensive' LNG to meet the mounting demand for natural gas, said energy experts.

Sources said the Norwegian seismic specialist TGS and US oilfield service Schlumberger are currently involved in such a seismic project in the Gulf of Mexico.

To bring back TGS-Schlumberger's confidence, Petrobangla had to discuss one to one with around a dozen of international oil companies (IOCs) and attain their feedback about the recently adopted model production sharing contract (MPSC).

Petrobangla will also have to announce a fresh bidding round at least for some offshore blocks within the next several months, sources said.