The US oil company Chevron has decided not to leave Bangladesh on conditions that the government would increase the price of natural gas it supplies from Bibiyana field and allow it to install a compressor there at $400 million.
Chevron has revised its earlier decision to sell out its stakes in three gas fields, including Bidiyana, to Chinese consortium Himalaya Energy Co Ltd at $2 billion, said officials of Petrobangla, the state-run oil, gas and
mineral resources corporation.
‘The government appreciates the Chevron decision and is positively considering its proposal,’ state minister for power, energy and mineral resources Nasrul Hamid told New Age on Thursday.
Chevron wants to invest $400 million for installation of a gas compressor at Bibiyana field to maintain level of gas supply from the field, he said.
A top Chevron official earlier this month informed Petrobangla chairman Abul Mansur Md Faizullah of its revised plan, said a Petrobangla official preferring anonymity.
The official said that Chevron wanted to raise the gas price to $3 per thousand cubic feet from $2.7, which would require amendment to the Production Sharing Contract signed with the company.
Besides, Chevron’s $400 million investment would raise the company’s share on the gas and condensate extracted from the Bibiyana field allowing it to realise the investment, the official added.
Chevron Bangladesh Ltd refused to give any detail of the meeting with Petrobangla and said in a response to a New Age query: ‘Chevron regularly engages with national, regional and international stakeholders globally. As per our long-standing policy, we do not discuss [with any outsider] specific meetings with government officials.’
On April 24, Chevron issued a release saying that it had entered into an agreement with Chinese Himalaya Energy Co Ltd to sell its three onshore gas fields and associated assets in Bangladesh.
Chevron had kept the government in the dark about the process of selling out its stakes to the Chinese company until it issued the release.
In October 2016, the government, however, took a move to buy Chevron’s stakes in the three gas fields and carried out a study to assess the remaining assets there.
Chevron now operates the gas fields — Bibiyana in block 12, Jalalabad in block 13 and Moulvibazar in block 14 — under three production sharing contracts with Petrobangla.
Chevron supplies 1,546.4 million cubic feet of natural gas from the three fields, which is 57.48 per cent of the daily national gas supply, according to Thursday’s supply forecast of Petrobangla.
Of its total supply, Chevron supplies approximately 1,251 million cubic feet gas per day from Bibiyana alone, which is 46.5 per cent of the daily national supply.
In late 2014, Chevron invested $500 million in Bibiyana to increase the volume of gas supply from the field by 300 million cubic feet per day.
In 2015, Petrobangla turned down a Chevron proposal to install a compressor at Bibiyana gas field.
The increase of gas supply from Bibiyana drew severe criticism from local experts as they said it would kill the country’s largest gas field.