Petrobangla commenced negotiations yesterday with three international oil companies (IOCs) for three offshore gas blocks, targeting a conclusion by the end of the month.
The three deep sea blocks — DS12, 16 and 21 — are located at depths ranging from 20 to 200 metres, with area 3200 to 3600 square kilometers in the Bay of Bengal in Bangladesh.
Petrobangla received formal proposals for the blocks in the form of request for proposals (RfP) from Singapore-based Kris Energy, South Korea’s Daewoo International Corporation, and Norway’s Statoil on May 7. An RfP is treated as the final offer.
Prior to submitting the RfPs, Kris Energy and Daewoo initially submitted expressions of interest (EOIs) for the deep-sea blocks in the last week in February in the form of unsolicited offers, responding to a call from Petrobangla.
Statoil had long been embroiled in negotiations with the government over the blocks without any breakthrough. The Norwegian company submitted its own RfP on the same date to stay in the race.
“We’ll start the negotiations with Daewoo on Sunday. Then separate negotiations will take place with the other two,” Petrobangla director (PSC) Md Quamruzzaman told.
Petrobangla Chairman Ishtiak Ahmed said the target was to conclude negotiations with the three IOCs within the current month. Our final target is to complete the awarding process by September to allow the companies to utilise the coming dry season for exploration purposes.
Ishtiak said through these talks the government would be trying to set a standard for future negotiations over the gas price and other issues in its deep-sea blocks.11
