Let's import gas from Myanmar |
Fast growing economies like India, China, and Thailand have been importing natural gas, and will continue to do so in the future to keep the wheels moving.
Yes, we are also one of the fastest growing economies in the world. The World Bank fact sheet 2005-2006 says that Bangladesh is the tenth most rapidly growing economy among 31 developing countries.
In its Global Economics Paper, issue number 134 published on December 1, 2005, Goldman Sachs has placed Bangladesh among the "next 11" countries, after Brazil, Russia, India, and China, which have the potential to be substantial economies in the next decade.
Against all odds, our country is showing encouraging economic growth thanks to the intelligent and enterprising people. With a corruption free administration, uninterrupted power supply and efficient ports, our annual economic growth rate will certainly reach double-digit. Robust growth of the economy will make Bangladesh an energy-hungry country. What are we thinking of to meet our growing energy needs and energy security?
A couple of years ago, we were told by our friends to export gas to India; as if Bangladesh would always remain an industrially backward country, and our requirement for energy would never increase, therefore, we should remain happy with some earning from exporting our natural gas.
It is high time now to think seriously about importing natural gas, keeping in mind that our reserves are dwindling fast. Natural gas is not only cheaper, it is also environment friendly. We can import it from Myanmar.
It was reported few days back that, according to the adviser to the Ministry of Energy and Mineral Resources, our total proven natural gas reserve is large enough to satisfy the domestic demand till 2011. It is alarming information, as we have a notion that our country is floating on natural gas.
Bangladesh, which has 20.28 tcf gas reserve, ranks 40th in the world in terms of proven gas deposits. Of this, we have already used 6 tcf. The country will be looking for more and more fuel as demand soars with rapid economic growth; and our small reserve of natural gas will be used up in less than a decade.
In 2005, India, Bangladesh, and Myanmar agreed in principle to cooperate in a gas exploration and overland pipeline project. The pipeline would run from Arakan state in Myanmar, through Mizoram and Tripura, and cross Bangladesh before reaching Calcutta.
Both Bangladesh and India would have the right to access the pipeline as and when required, including injecting and siphoning off their own natural gas. The pipeline would bring gas reserves from the Shwe Field's Block A-1 site on the Arakan coastline along the Bay of Bengal.
This pipeline would also help Bangladesh to supply gas from its own fields in the Sylhet region, as well as from Tripura, to Khulna and Jessore.
Bangladesh laid out some preconditions for letting the pipeline run through its territory. We demanded reduction of trade deficit between India and Bangladesh, transit for trading goods to and from Nepal and Bhutan, and India's permission to buy cheap hydropower from Bhutan and Nepal. India refused to accept the conditions, and is looking for a new route, Bangladesh.
India thought of eight alternative routes, bypassing Bangladesh, for importing gas from Myanmar. If the pipeline is laid through Bangladesh to West Bengal -- as was originally planned -- it would be 900km long and cost around Rs. 450 million.
If it is laid through the northeast, bypassing Bangladesh, the pipeline will be 500 km longer, and the additional cost will be to the tune of Rs. 250 million. But the transit fees to be paid by India to Bangladesh for allowing the pipeline to pass through its territory will offset the additional cost. The Indian government is, perhaps, unwilling to decide on that route for security reasons, as northeast India is under the grip of local insurgencies.
Seeing the uncertainty in execution of Myanmar-Bangladesh-India pipeline, Myanmar has declined to supply gas to that proposed pipeline. Instead, it has signed an agreement to sell 6.5 tcf from A-1 block reserve through an overland pipeline to Kunming (China) for 30 years.
Myanmar is still willing to supply gas to the proposed tri-nation gas pipeline from other gas blocks if Bangladesh and India are successful in ironing out their differences.
As the gas from A-1 block has been sold to China, we have to get it from block A-2, though at least 150 km additional pipeline will have to be laid to reach that gas field.
India may think that we should be happy with $125 million annually as transit fees from the pipeline, so we should not tag any conditions to it. But transit fees must not be our main concern. We are to forgo the conditions we tagged to the gas pipeline, not to earn the transit fees, but to use that pipeline to import gas at a cheaper price. Moreover, it is our moral duty to give transit to our neighbour, no matter whether it feels the same way or not.
According to the World Bank, the demand for electricity in Bangladesh is increasing at 500 MW a year, but according to the government it is 800 MW a year. The estimates are based on the present economic background. It will not be surprising if the demand increases in two to three years, to 2,000 MW a year, with charged up economic performance. To run power plants, we will need ever-increasing amounts of natural gas and coal. The domestic production of gas and coal will be unable to meet the requirement.
If India abandons the plan to import gas from Myanmar, then we are to go alone. The route from the Arakan coast into Bangladesh via Cox's Bazaar will be the easiest and shortest.
Moreover, this route has minimum hilly terrain. We may import gas through Bangladesh-Myanmar pipeline from that country's offshore block A-3. With the gas from Myanmar as fuel, power plants can be set up at Chittagong. We need power not only for industries, but also for irrigation of paddy fields.
Let us not dillydally, lest we lose the opportunity to access the gas at A-3 block. If the question of choice between the Myanmar-Bangladesh-India pipeline and the Myanmar-Bangladesh pipeline arises, then we must go for the first one; if no question of choice arises then we are to go for the second one.
Faruque Hasan is a freelance contributor to the Daily Star.