Petrobangla, ConocoPhillips to Sign Gas Exploration Deal

The Bangladesh state oil and gas company Petrobangla will sign a deal with ConocoPhillips on June 16 for gas exploration in two "undisputed" offshore blocks.

The purchase body of the cabinet headed by Finance Minister AMA Muhith today approved the Petrobangla's proposal.

The cabinet committee on Economic Affairs approved the energy ministry's proposal on May 23 to award Conoco Phillips the two "undisputed" offshore blocks for gas exploration, officials said.

"Under the agreement Conoco will explore the areas of the block 10 and 11," a top official of the energy ministry said.

According to the proposal, the government decided to discard the disputed areas of the two blocks until settlement of the maritime boundary issues with neighboring India and Myanmar.

This move will open a new horizon as Bangladesh for the first time will explore in the deep sea for hydrocarbon resources," the official said.

Petrobangla started negotiations on October 5, 2009 with Conoco Phillips to award the offshore blocks, but could not reach any conclusion.

Conoco Phillips earlier said it would spend US$2.496 million to conduct a two-dimensional seismic survey of 1,200 'line kilometers' in five years after getting the contract in line with obligations under the PSC.

But now they said they planned to spend $15 million for each of the blocks, as the disputed areas would remain beyond the exploration campaign.

According to an official source, during the first round negotiation, Conoco wanted eight out of 22 offshore blocks, which was not approved by the cabinet body.

Source: EnergyBangla