USA's ConocoPhillips to pull out of Bangladesh exploration
28 Oct 2014 12:01 AM GMT
US energy giant ConocoPhillips has decided to stop exploring for oil and gas in Bangladesh's two deep-sea blocks after deciding it was not commercially viable, a minister said on Monday.
Bangladesh awarded the US company rights to explore in blocks 10 and 11 in the energy-rich Bay of Bengal in 2011 after Myanmar found a huge gas reserve in nearby waters.
But after conducting two surveys, ConocoPhillips has told Bangladesh's state energy group PetroBangla it will not continue exploring, the country's junior energy minister Nasrul Hamid told AFP. ‘We have come to know they (ConocoPhillips) are going to pull out of the blocks No. 10 and 11,’ Hamid said. ‘They are pulling out as the prospect of the gas reserve in these blocks is not commercially viable for the company,’ said Hamid.
In an email to the Dhaka Tribune newspaper, ConocoPhillips Bangladesh managing director Thomas J Earley was quoted as saying the firm was unable to justify drilling. ‘We have, therefore, decided not to continue petroleum operations and the PSC (production-sharing contract) will terminate on December 15, 2014,’ Earley wrote.
The Bangladesh minister said the company wanted to raise the price agreed in the 2011 contract, arguing the rate at which it has to sell up to 75 per cent of the gas to Petrobangla is too low. The pullout could deal a blow to the nation which badly needs new gas reserves to feed its fast-growing economy.
Bangladesh awarded the US company rights to explore in blocks 10 and 11 in the energy-rich Bay of Bengal in 2011 after Myanmar found a huge gas reserve in nearby waters.
But after conducting two surveys, ConocoPhillips has told Bangladesh's state energy group PetroBangla it will not continue exploring, the country's junior energy minister Nasrul Hamid told AFP. ‘We have come to know they (ConocoPhillips) are going to pull out of the blocks No. 10 and 11,’ Hamid said. ‘They are pulling out as the prospect of the gas reserve in these blocks is not commercially viable for the company,’ said Hamid.
In an email to the Dhaka Tribune newspaper, ConocoPhillips Bangladesh managing director Thomas J Earley was quoted as saying the firm was unable to justify drilling. ‘We have, therefore, decided not to continue petroleum operations and the PSC (production-sharing contract) will terminate on December 15, 2014,’ Earley wrote.
The Bangladesh minister said the company wanted to raise the price agreed in the 2011 contract, arguing the rate at which it has to sell up to 75 per cent of the gas to Petrobangla is too low. The pullout could deal a blow to the nation which badly needs new gas reserves to feed its fast-growing economy.
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