Scope widened

Bangladesh's winning its maritime boundary claim over Myanmar's implies that the country will now have a larger deep sea oil and gas exploration area in the eastern Bay of Bengal.
A well-placed Petrobangla source told The Daily Star that at least two new oil and gas exploration blocks can be added to the country's offshore block map in the eastern Bay.
The dispute resolution under the United Nations Convention on the Law of the Sea may also clear Myanmar's claims over six existing blocks of DS08-11, 12, 13, 16, 17 and 18.
“It is indeed a good news. But we will be able to explain the implications definitively once a copy of the verdict of the International Tribunal for the Law of the Sea is handed over to us from the foreign ministry,” said the source.
“We can then prepare an updated topographic map,” he added.
In 2008, Bangladesh floated its offshore block bidding for oil and gas exploration in 28 blocks, 20 of which are in the deep sea. Large areas of many of these deep sea blocks were claimed by India on the western side and Myanmar on the eastern side. The maritime claim dispute had watered down much of the interest of the oil companies.
As an outcome of this bid, US company ConocoPhillips signed a Production Sharing Contract (PSC) for two blocks -- DS 10 and 11. Of these, a part of block 10 is claimed by India and a part of block 11 by Myanmar.
The PSC permitted the company to explore the undisputed part. Once the dispute is solved, it will enjoy the right to explore the remaining part.
The company had also submitted bids for blocks 12, 13, 15, 16, 17 and 18 -- all of which were in the disputed area -- mainly with Myanmar.
With yesterday's verdict, around 15 percent area of block 11 will be dispute-free.
“Conocophillips is currently conducting seismic survey of around 2,200 kilometres. The disputed area -- around 200 km -- is left out of the survey. The company is set to complete its survey by next month and then it would interpret the data to find prospects of drilling. If it finds some prospects, it will seek approval for further programmes like drilling a well,” said the official.
The two blocks of Conoco comprise a total area of 5,158 sqkm and are located under 1,000-1,500 metres deep water and approximately 280 km from the port city of Chittagong.
If the company finds no prospect, it can give up the block by mid-2014 as per the PSC.
To enjoy the freedom of exploring a completely undisputed sea area, Bangladesh will have to settle its claims with India in 2014.
The dispute popped up against the backdrop of large oil and gas discovery in the Bay by both India and Myanmar.
Bangladesh has only one producing field in the shallow waters of the Bay -- the 14-year-old Sangu field-- which is now virtually in its death bed. In its best of times, the Sangu field produced up to 160 million cubic feet per day (mmcfd) gas.
According to online energy magazine Geo Expro, from April 2009 India is producing 2.1 billion cubic feet per day from different fields in Dhirubhai deep water block in the Bay, which has 25 trillion cubic feet (tcf) gas in place. This is located in Krishna-Godavari Basin --the midpoint of Bangladesh and Sri Lanka. Indian Reliance Industries is leading the discoveries.
This has virtually doubled India's gas output. Other Indian discoveries in the Bay are closer to Bangladesh having another 5 to 6 tcf gas. According to the Geo Expro, India has drilled more than 50 wells -- most of those failed to find anything.
On the other hand, Myanmar discovered during 2003-2006 three gas fields having a total of 6 tcf to 10 tcf gas in place in the Bay. Korean company Daewoo made the breakthrough in these discoveries, following which all offshore western Myanmar is now under licence to international companies, including CNOOC, CNPC, Daewoo Petroleum, and ONGC Videsh Ltd.
Bangladesh has claimed a total of 2.07 lakh sqkm exclusive economic zone, half of which was mapped into 28 blocks in the 2008 bidding.
During 1974-76, six oil companies conducted about 33,000 line kilometres of seismic survey and drilled 7 exploratory wells. Back then only one gas discovery was made at Kutubdia by Union Oil. However due to limited reserve, the field could not be developed independently and Union Oil relinquished the area in 1976.
British company Cairn Energy under a PSC conducted seismic survey and drilled five exploratory wells namely Sangu-1, Sandwip East, Sonadia, Magnama and Hatia. Gas was discovered in Sangu in 1996 and two years later that gas was brought in for supply to the national grid.