Unocal's threat to stop exploration in Bangladesh

Vol 6, PW 11 (31 Jul 02) People & Policy
     

UNSURPRISINGLY, INTERNATIONAL companies are angry at the political brinkmanship in Bangladesh over gas exports and havethreatened to stop exploration unless assured of "greater market access" - an euphemism for gas exports to India.

On 22nd July, Scott Barber, managing director of Unocal Bangladesh, made this clear in Dhaka at a seminar on "Development of the gas sector in Bangladesh" organised by the Federation of Bangladesh Chambers of Commerce and Industry. In his keynote speech Barber said: "International oil companies are unwilling to explore gas because they are not sure of the return on their investment.

If there is no exploration, the existing supply of gas will be hampered." Barber pointed out that of the 64 wells, international oil companies have drilled 44. Of the 22 gas discoveries, 12 were discovered by overseas companies establishing cumulative reserves of 14.74 trillion cubic feet - or 92% of Bangladesh's reserves from existing fields.

Barber also dwelt on the benefits to Bangladesh if it accepted Unocal's report submitted in November 2000 seeking to export gas to India. Shell shares Unocal's views.

At the same seminar, Reiner Reddingluis, managing director of Shell Bangladesh Exploration and Development also spoke in support of gas exports. Reddingluis said international oil companies have reconciled themselves to the idea of exporting a limited quantity of gas - 3 trillion cubic feet - which is only 10% of the country's undiscovered gas reserves.

Unocal chief geologist A. H.

M Shamsuddin, meanwhile, cited studies by various agencies including Petrobangla to support his argument that Bangladesh's undiscovered gas potential is over 32 trillion cubic feet.