The Indian oil-and gas-exploration company ONGC Videsh Ltd (OVL) has sought a further two-year extension of its production-sharing contract (PSC) tenure to carry out its committed exploration job.
It wrote a letter to the state-run Petrobangla to extend the tenure until February 2025, a senior Petrobangla official told the FE on Wednesday.
If extended, it would be the third extra period of time the OVL gets from Petrobangla.
Petrobangla earlier extended the tenure of the PSC with the OVL by two more years until February 2023 to boost offshore exploration.
Petrobangla signed two PSCs with OVL, the operator of shallow sea (SS) offshore blocks SS-04 and SS-09, on 17 February 2014, which expired in February 2019.
The OVL is contractually pledge-bound to drill two more wells-Titly in block SS-04 and Moitree in block SS-09.
It has already floated tenders thrice to engage a contractor to do the drilling of Titly and Moitree wells but yet to award the job to any firm.
The OVL has a budget to drill the wells at $65 million.
It sought an extension in the fond hope that contractors will demand less drilling costs after months with the easing of the current global energy market turmoil, he added.
But several months back, the Indian firm 'failed' to discover any presence of hydrocarbon at Kanchan gas well under the SS-04 gas block at Moheshkhali Island.
It plugged and abandoned the well subsequently.
The OVL drilled beyond its targeted depth of around 4,228 metres beneath the surface in search of a commercially viable gas deposit at Kanchan.
Plugging and abandoning the well means the well does not have any prospect of hydrocarbon reserve.
The firm could find only huge deposits of clay and shell-stone sequence in the absence of sandstone, meaning there is no gas-reserve prospect there.
Kanchan well was up for the first offshore drilling in the country's maritime territory in five years.
Australian company Santos along with the Bangladesh Petroleum Exploration and Production Company Ltd (BAPEX) in February 2017 drilled Magnama-02 well under block 16 only to find it dry.
The joint venture drilled the offshore well into a depth of around 3,200 metres, which cost the BAPEX an estimated $29 million.
The country has no producing offshore gas well and the entire natural gas output comes from onshore fields as well as the import of liquefied natural gas (LNG).
The OVL is the operator of blocks SS-04 and SS-09, having a participating stake of 45 per cent.
The OIL holds 45-per cent participating interest and the BAPEX holds the remaining 10 per cent.
Block SS-04 covers an area of 7,269 square kilometres while block SS-09 stretches over an area of 7,026 sqkm.
Water depth of both blocks ranges between 20 and 200 metres.
As per the PSC, the OVL is committed to conducting 2,700 line-kilometre 2D seismic data acquisition and processing and one exploratory well in block SS-04.
It is also committed to doing the same for another 2,700 line-kilometre 2D seismic data-acquisition and-processing and two exploratory wells in block SS-09.
The OVL will be allowed to operate and sell oil and gas for 20 years from an oil field and 25 years from a gas field. It has already completed around 3,100 line-kilometre 2D seismic surveys for both blocks.
