bd EnergY LinK

Chevron for further exploration to find new gas reserves

FE Report

US energy giant Chevron Monday pushed the government to increase the number of production sharing contracts (PSC) for the country’s gas fields to woo more foreign investment in the ailing energy sector.

At the same time, it has insisted on starting exploration activities to find new gas fields as well as improving the country’s energy infrastructure to ensure uninterrupted supply of gas throughout all the regions.

“In the present context, it is obvious that the short and mid term solution to Bangladesh’s growing energy crisis lies in gas”, Chevron Bangladesh President Steve Wilson said at a programme in the city.

“Around 90 percent of the country’s energy demand is now met through gas and although there could be possible additional sources in coal, hydroelectricity and atomic energy plants, gas is the most immediate solution to the crisis”, he added.

Depicting a gloomy picture of the country’s present energy scenario, the Chevron President, whose company supplies around 50 percent of the country’s total gas demand, said that the country is already in the helm of a gas crunch which is likely to be intensified in the coming years.

The Chevron chief stated that his company is aiming to increase its own production capacity in a bid to meeting this ever increasing demand and highlighted a few constraints in addressing the emergency.

“From our part, Chevron is capable of increasing the capacity of its gas fields to meet that growing energy demand but the key barrier to this process is infrastructural inadequacy”, he said at a luncheon meeting organized by Foreign Investors Chamber of Commerce and Industry (FICCI).

“Our seismic survey has proved that there is a large volume of unexplored gas in Moulovibazaar while we are also working to increase our capacity in Bibiana which already supplies one third of the country’s total gas”, he added.

“The reason why Bangladesh is now faced with this acute energy shortage is that the investment in energy in the past was not adequate for meeting today’s demand”, Wilson said.

“Therefore, to attract more investment in the energy sector, the number of production sharing contracts for gas fields must be increased”, he said.

“It must be noted that the cyclic time between obtaining the exploration license for gas fields and getting into the production stage usually spans around seven to eight years”, Wilson said, adding, “so speedy decision making is a key in assuring short term solution to gas crisis”.

The Chevron Chief also noted that the relative low gas price in Bangladesh’s domestic market as well as recent global financial crisis has growingly made it tough for the country to woo foreign investment in power and energy.

“The recent global economic meltdown has already made it difficult to attract investment from abroad in the energy sector”, Wilson noted.

“Moreover, it is a daunting task to attract the investors in a market with one of the lowest gas prices on earth”, he added.

However, focusing on the country’s highly potential but untapped energy arena, the Chevron President urged to adapt more effective commercial and fiscal terms to make the country’s energy sector more attractive for foreign investment.

President of Foreign Investors’ Chamber of Commerce and Industry (FICCI) A M Hamim Rahmatullah also spoke on the occasion.