This will be the first drilling under the second round block bidding that virtually concluded two years ago. With it ended the venture of the Bangladesh Petroleum Exploration Company (BAPEX) as a partner of foreign oil companies.

"The foreign investment in this venture will be a fresh shot in the arm of our gas sector," observes a Petrobangla source. He said the four partners will drill the second well in the Gumti river area one month after the Kashimpur operation under a production sharing contract (PSC) for Block 9 spreading over 6880km.

As per the PSC signed on April 11, 2001, the oil companies will drill the third well in Block 9. The location is however not yet identified.

"We have two more potential areas where we can drill another well," said a Chevron-Texaco official. "It is either in Lalmai or in Chandpur. To decide on this issue, we are going to hold a meeting in Ireland soon."

Considered a highly prospective zone, Block 9 is situated at the heart of the gas pipeline network, a location that gives explorers a built-in advantage for explorers to mobilise equipment as well as to connect the national gas grid easily.

Irish company Tullow and US companies Chevron and Texaco will spend about $6 million for drilling each well. The three companies equally share 90 per cent equity among them while BAPEX holds the rest without investing in the venture.

"They have already completed seismic survey on 1,000km area and conducted an additional three-dimensional survey covering 455sqkm area," said a Petrobangla official. "BAPEX also conducted a survey covering 572km area and an international company, PGS, conducted a survey, including the three-dimensional one, on 430km area."

A BAPEX geophysicist said that this was the first time the state-owned explorer came up with a seismic survey of international standards. "This job earned us about Tk 6 crore in cash and Tk 3 crore more in terms of equipment," he said. "We were able to maintain the standard because the trade union did not interfere in these tasks."

Sources said the companies have acquired 19 acres of land for each of the two prospective drilling spots. The prospective well in the Gumti area is situated in a densely populated area. Not to cause disturbance, the oil companies chose a location 2km away from the locality, from where it will drill a directional well.

"We have completed three fourths of the preparatory works," said the Chevron-Texaco official.

Among two other spots that were marked potential on the basis of the seismic surveys, Lalmai was explored by the Shell four decades ago. Shell drilled two wells there and subsequently deserted the sites finding no sign of gas or oil. But Tullow, Chevron and Texaco believe the present data clearly show presence of hydrocarbon there.

Upon fulfilling the three-year PSC obligations, the three companies will enter the second phase of agreement extended for four years. In that phase it will drill 10 exploratory wells.

Tullow was initially selected alone for Blocks 9 and 11 back in 1997 due to its outstanding work programme. Tullow had offered to drill 10 exploratory wells in the first three years alone at a cost of $56 million, a proposal termed unrealistic by most experts.

As there was growing criticism about preferential treatment for Tullow due to its links with political high-ups and its financial insolvency, the government invited US oil giants Chevron and Texaco to strike a partnership with Tullow.