8 IOCs show keen interest in offshore sea block survey  

The state-owned oil and gas exploration corporation has received expression of interest (EOI) letters from 8 global players to conduct the multi-client seismic survey in the offshore sea blocks.
"Companies like Wood Mackenzie and HIS Global are showing interest to do the survey. November 21 has been set as the deadline to submit EIO by the interested bidders, we received 8 EOIs," a senior official of the Petrobangla told the Daily Observer on Monday.
Energy Division took long six years to select a consultant and to award a contract to conduct the multi-client seismic survey in the offshore sea blocks.
Petrobangla is going to appoint an experienced
foreign consultant to prepare the amendments to the document that would convince the IOCs to invest in Bangladesh's offshore gas fields, officials said.
Amid fuel price hike in the international market, Energy Division has moved to further amend the Model Production Sharing Contract (PSC)-2019 to attract international oil companies (IOCs) for gas exploration. Fuel price hike has prompted the government to go for further amending the existing PSC to attract the IOCs to the Bangladesh offshore gas blocks. Multi-client seismic survey is the first step of it.
They said Petrobangla now plans to complete the appointment of consultants within the next two months and receive their report by April next year. It hopes to complete the amendments by May and invite international bidding for IOCs in June next year in order to start exploration works before the end of 2022.
The country has a total of 48 blocks of which 26 are in offshore areas and 22 are onshore. Of the 26 offshore blocks, 11 are located in shallow sea (SS) water and 15 are located in deep sea (DS) water.
In 2019, Petrobangla raised the gas price for IOC to US$5.5 per thousand cubic feet (MCF) for IOCs in shallow water blocks while $7.25 per MCF for deep sea blocks. There was a target to invite international bidding in March 2020 for exploration in offshore areas but it was postponed due to Coronavirus pandemic.
Finally the government has dropped the idea amid a huge debate over the gas price. A section of people said it is too high. However, government is now importing LNG at $36 per MMBtu while it was just below $10 early this year.
"At least a 15-year experienced foreign firm will be hired to help the government to prepare the amendments to the PSC in the light of the IOCs expectations," officials said.
Energy Division instructed Petrobangla to hire such a consultant in February 2022 to start exploration before the end of 2022.   
The last model PSC was adopted in 2012, and it was later amended following immense pressure from IOCs, which argued that the prices for oil and gas listed were too low. According to the last amendments, an IOC would sell around 50 per cent of the gas produced to Petrobangla at $6.50 per Mcf (1,000 cubic feet)+2 per cent increase per year, instead of $5.50. The amendments also exempted IOCs from paying transport tariffs and corporate tax.
The government, in the new offshore model production sharing contract, is now planning to increase this to $7.25 per Mcf+2 per cent increase per year.
Petrobangla mulled the enactment of a new PSC for the off-shore block after it invited fresh bids from international companies for two-dimensional (2D) seismic surveys of 21 hydrocarbon blocks in the Bay of Bengal in the middle of December 2015. The blocks cover an 81,000 sq km area of the bay, with depths varying from 20 metres to over 2,500 metres.
The country's natural gas output is currently hovering around 3,266 million cubic feet per day (mmcfd), of which 921 mmcfd is regasified imported LNG, according to Petrobangla.
About four IOCs have active PSCs either individually or under a joint venture in three shallow-water blocks for offshore exploration of hydrocarbons. ONGC Videsh Ltd (OVL) and Oil India Ltd (OIL) are jointly scouring for gas and oil in shallow-water blocks SS-04 and SS-09.
America's 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 Gas Field.
Bangladesh's offshore area remained unexplored despite resolving its dispute with neighbouring countries.
Under a Model PSC, normally, if any IOC discovers gas, it gets 40 per cent stake while the government obtains the remaining 60 per cent.