Bangladesh is currently undergoing a massive shift in terms of its energy mix, as it proceeds to exhaust its last known reserves of natural gas, even as massive regasification units stationed outside of Chittagong Port signal its shift to importing this important and clean source of energy to fuel its power plants that must keep up with the demands of a heaving population that already exceeds 160 million and an economy growing at over 8 percent - the fastest in all of Asia.

The government has acted to ensure there is no discernible slowdown of this growth engine, and ensuring seamless supply of energy is paramount to that. Hence the contracts with Qatar and Oman to import LNG at $8 per mmBtu, plus the 60 cents for regasification offshore before each unit can be inducted into the fuel mix for the country's national grid.

Recently at an event hosted by SEAPEX (the South East Asia Petroleum Exploration Society) in Singapore, I presented the country's renewed efforts to the IOCs to further explore its hydrocarbon reserves, particularly in some deep sea offshore blocks that it recently gained, which have never satisfactorily been explored. A number of past efforts by Petrobangla on its own or by some of the IOCs that it has contracted at times have all been abortive for some reason or the other.

This time though, I explained to the audience of executives leading the regional operations of some 30 top energy companies/IOCs, the difference is that the government is approaching this in a more open, transparent and yet responsible manner. There are two principal planks that serve to anchor this approach are to be found in the draft of its updated Model Production Sharing Contract (MPSC), and the decision to proceed with a multi-client 2D seismic survey for its Offshore blocks, rather than rely on IOCs to come up with the information.

Petrobangla now wishes to have the upcoming Bid Round Launch for both its shallow offshore and deep offshore blocks in the Bay of Bengal, this year.

The bulk of my presentation to Seapex explained why these two steps are so important.

Jon Savage, former President of Seapex, said "The multiclient siesmic survey in the Bay of Bengal is progressing and will be for the betterment of Bangladesh's energy needs."

Model PSC

The Bangladesh Government has taken initiative for updating the Model Production Sharing Contract (MPSC) to attract the International Oil Companies (IOCs) to participate in the next bidding round for Oil and Gas exploration in the country's offshore blocks soon. Petrobangla has been updating the Model PSC by bringing in some positive changes in the provision to make the offer more attractive for International Oil Companies.

The Government also took the initiative, finally, to conduct multi-client seismic survey for Bangladesh Offshore area in the Bay of Bengal, which has been awarded to TGS-Schlumberger JV. The contractor will conduct the seismic survey in the Bay covering 32,000 line-kilometers, in both deep and shallow waters. The survey is estimated to be completed within eight months and would generate data to be available to interested bidders in the planned upcoming offshore block bidding. The 32,000 line-kilometers will mostly consist of very long lines ie less changing of lines which will make it easier to cover within eight months.

Petrobangla had appointed the consultant, RDL, New Zealand for the upgradation of the Model Production Sharing Contract (MPSC) for the Bangladesh offshore blocks earlier, and please note that RDL has submitted its suggested proposals for the changes to the MPSC to Petrobangla. Petrobangla has finalized the MPSC in line with the consultant's recommendations.

The main points of the new changes to the MPSC are:

i) In terms of the mandatory work programme, for both SS and DS blocks, Seismic is mandatory within 3 years. After that Contractors have the option to decide whether they will enter into 4th and 5th exploration year or not. If yes, drilling is mandatory. Otherwise relinquish.

- Longer extension to production period written into PSC.

ii) Gas price for SS about $0.6/mscf higher Gas price for DS about $0.77/mscf higher Yearle esc. 1.5% (previously 2%)

iii) Export Provision for DS blocks subject to Petrobangla's right of first refusal. At first Contractor will offer the gas to Petrobangla. If PB refuses to buy then Contractor will sell it to the 3"' Party within Bangladesh domestic market. If no domestic market available, then they can Export.

2D Multiclient seismic survey

The objective of this undertaking is to select a marine seismic contractor to design, acquire, process and perform preliminary interpretation of 2D Non-Exclusive Multi-Client data for the use of both GOB/ Petrobangla and International Oil Companies (IOCs) for prospectivity studies, prior to a block offering. A TGS interpretation report will be provided later.

The data acquired under this programme are to be used to, among others:

* provide a detailed modern high quality broadband 2D seismic grid over the whole Bid Round area to enable Bidders to analyse the offered blocks using the best data quality possible.

* Obtain knowledge about sedimentation, stratigraphic and structural evolution of the offshore areas of Bangladesh.

* Create a database to offer new prospective areas for a future bidding round to the International Oil Companies.

Survey Area:

The survey area shall cover the open blocks within the Exclusive Economic Zone and Outer Continental Shelf of Bangladesh. The range of water depth to be covered will be from 20m to more than 2500m and for approximately 32,000 line kilometers.

The survey area shall cover the open blocks within the Exclusive Economic Zone and Outer Continental Shelf of Bangladesh.

The survey is planned to start in October 2020 and be completed by May 2021. Data processing would start by December 2020 and a fully processed dataset should be available by October 2021.

The event was attended by around 30 international oil companiues (IOCs).

Masud Khan, Deputy Managing Director, Cosmos Energy Services.