The energy division has taken the initiative to reform the Production Sharing Contract, PSC, by increasing gas price and cost recovery rate.
An amended draft of the PSC has already been sent to the energy ministry for approval.
Once the new PSC is approved, Petrobangla will call for new international tenders.
A PSC official says: “foreign companies have been demanding 100 per cent cost recovery from the beginning, which means, they will recoup all cost for oil-gas exploration; but if that happens, Petrobangla will not get any gas.”
Petrobangla wants the highest recovery to be within 65 to 80 per cent, said the official and added: “each unit of gas from the ocean is $ 6, the companies want to raise it to $ 8 or $ 9.”
Petrobangla GM, Shahnewaz Parvez, told Bangla Tribune: “after the amended PSC is finalized, we will call for tenders; since local companies do not have the necessary equipment or experience, we want to lure foreign companies.”
Bangladesh has 48 exploration blocks in the country; of them, 22 are on land and 26 on sea, with 11 in shallow waters and 15 in deep sea.
Relevant people say that the gas price mentioned in the current PSC is not attractive to foreign companies and, that’s why US based company, Conoco Phillips, went back after initial survey in two blocks.
In such a situation, the PSC will be amended to attract foreign companies. Following the approval from the ministry of energy, the draft PSC will be sent to the ministry of law for opinion. Afterwards, with cabinet approval, the amended PSC will be finalised.