A Norwegian-US joint venture styled TGS-Schlumberger risks losing its bank guarantee worth US$500,000 as it delays start of multi-client survey on energy potential in the Bay, while Bangladesh faces fuel crisis.
The JV has up to March 2023 to complete the survey under its deal with Petrobangla, the state-run petroleum agency now exasperated by global energy-supply crunch.
"The JV firm has not yet informed us of its readiness to initiate its survey in the Bay," Petrobangla chairman Nazmul Ahsan told the FE Monday.
"If the TGS-Schlumberger does not carry out its job, we will have to confiscate its bank guarantee," says the corporation top brass.
Sources say TGS-Schlumberger was selected for the job through a competitive bidding. The cabinet committee on economic affairs finally in April 2019 approved awarding the job of carrying out multi-client seismic survey to the TGS-Schlumberger JV.
The pandemic and the subsequent record fall in oil and energy prices on the international market, however, had kept the contractor at bay from initiating the survey in the Bay of Bengal waters that resulted in the delay.
The Norwegian seismic-specialist TGS and oilfield services providers Schlumberger are currently involved jointly with a multi-client seismic project in the US Gulf of Mexico.
The JV is expected to carry out the survey in 21 offshore blocks within the sovereign territory of Bangladesh, where potential hydrocarbon reserves remain untapped while neighbours are reportedly extracting fossil fuels.
The blocks together cover an 81,000-square-kilometre area at depths ranging from 20 metres to around 2,500 metres in the Bay.
On completion of the survey, Petrobangla would provide the interested international oil companies (IOCs) with the non-exclusive multi-client seismic data of the offshore blocks to help them carry out basin evaluation, prospect generation and participation in the bidding for exploration.
As per the tender terms, the JV surveyor would not get any payment from Petrobangla for their work but they would be free to sell data to interested IOCs.
The joint-venture firm, however, would have to share the seismic data and the profits with the host.
The TGS-Schlumberger tie-up got two years to complete the survey and over the next eight years they would be free to trade the data.
Bangladesh never conducted multi-client seismic surveys in offshore areas. The country had earlier floated international tenders several times to carry out oil and gas exploration both in onshore and offshore areas by the IOCs. The bid-winning IOCs carried out seismic surveys of their own in their respective blocks before initiating oil and gas explorations.
The country's offshore areas are now well-demarcated following the verdicts from international courts. Bangladesh has territorial rights of up to 200 nautical miles from shore as exclusive economic zone in the Bay of Bengal.
Besides, the country has free access to around 387 nautical miles into deep sea following demarcation of maritime boundary by international court of arbitration.
There is, however, huge potential of getting hydrocarbons in Bangladesh's territorial waters as both India and Myanmar already discovered huge gas in the Bay.
"The IOCs are expected to show significant interest in exploration in the country's offshore areas once the seismic data are available," says energy-expert Prof M Tamim, who is currently serving as pro-Vice-chancellor of Brac University.
Petrobangla had floated offshore bidding rounds without any survey in 2008, 2012 and 2016 but only few IOCs took part in the bidding while production- sharing contracts (PSCs) could be inked only for four blocks.
Currently, four IOCs have active PSCs, either individually or under joint venture, to explore three shallow-water blocks for offshore exploration.
ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) are jointly exploring shallow-water blocks SS-04 and SS-09.
US oil-major Chevron is active in exploring and producing natural gas in three onshore gas-fields under onshore blocks 12, 13 and 14.
Singapore's KrisEnergy is producing natural gas from Bangora field under block 9.
