Offshore exploration bidding opened

Petrobangla yesterday announced the 2008 offshore oil and gas exploration bidding round inviting offers from international companies by May 7.
The bidding will offer eight shallow water blocks and 20 deep sea blocks-- each having an exploration area between 3,000 and 7,000 square kilometres. The bidding is the first of its kind for the country where the focus is kept exclusively on the Bay of Bengal.
India has been exploring the Bay heavily in recent years and has discovered 100 trillion cubic feet (tcf) of gas and two billion barrels of oil.
Even Myanmar last year discovered 7 tcf of gas in an offshore area which may be overlapping with Bangladesh's maritime boundary.
Petrobangla has been making preparation for this block round since 2006.
In a press release yesterday, Petrobangla announced some important features of the contract under the bid. These include full repatriation of profit, no signature bonus or royalty, and no duty for equipment and machinery imported for petroleum operations during exploration, production and development phases.
As per the contract, the contractor will give a carried stake of 10 percent to the government only for shallow offshore blocks, and will enjoy the provision for assignment, 100 percent cost recovery, maximum 55 percent cost recovery per calendar year.
The contractor will also oblige to a mandatory seismic programme and one well for each block exclusive of biddable work programme.
The contract will have provisions for a discount on gas sale, discovery and production bonuses and annual contract service fee.
The contractor will also be allowed to go for local marketing of gas only if the government refuses to buy it first.
Petrobangla also declared the evaluation features. The bidder will have the authority to operate in at least one offshore acreage and offshore production of 25000 barrels of oil equivalent (BOE), biddable work programme commitment over and above the mandatory programme, and bank guarantee for performance of minimum exploration programme.
The details of the bidding round 2008 are available on the Petrobangla website: www.petrobangla.org.bd.
Petrobangla is also selling the bidders a basic information package which includes a model production sharing contract for US$ 100.
In addition, the bidders can purchase technical data at a promotional price.