China is about to buy the assets of Chevron in Bangladesh. Chevron Bangladesh has signed a preliminary deal with the China’s state-owned Zhenhua Oil to sell its assets in the country which includes 3 of the gas fields currently operated by Chevron, reports Reuters.
Chevron Bangladesh’s external communications manager Shaikh Jahidur Rahman said, “We can confirm that Chevron has been in commercial discussions about our interests in Bangladesh. We will not comment on negotiations as a matter of long-standing policy.” On the other hand, Zhenhua Oil’s spokesman Zhang Xiaodi said to Reuters, “as this project is in the process of commercial discussions, we can’t comment based on our company policy”.
Bangladesh’s state-owned Petrobangla claimed that, it is not aware of this preliminary deal. However, Petrobangla is also keen to buy the assets of Chevron in Bangladesh, which have an estimated value of around $2 billion. Petrobangla is trying to raise financing from international banks and also in its way to hire an energy consultant named Wood Mackenzie to assess the reserves. After assessing the reserves and their estimated market value, Petrobangla is planning to place a formal bid to buy those assets from Chevron, and as a state-run Petrobangla will get the first priority to buy those assets, claimed related sources.
Chevron had said in October 2015 that it planned to sell about $10 billion worth of assets by 2017 including geothermal projects in Indonesia and the Philippines and gas fields in Bangladesh amid a prolonged slump in energy prices.
Sources from Petrobangla claimed that, the production of Chevron has dropped in the last 2 consecutive years. In the fiscal year of 2014-15 Chevron sold gas worth BDT 4 thousand and 600 crore to Petrobangla which dropped to BDT 4 thousand crore in the fiscal year 2015-16. Chevron also lessened its investment by 19 percent which worth around $220.89 million in these three gas fields in the last 2 years.
Chevron has around 2 thousand permanent, temporary, contractual of employee right now. Chevron hasn’t renewed any prevailing contracts with its employees in the last one year and curtailed the expenses in its offices and gas fields.