Committed to PEOPLE'S RIGHT TO KNOW
Vol. 5 Num 1029 Tue. April 24, 2007  
   
Editorial


Chronicle
Please tolerate no nonsense


The impending gas crisis in Bangladesh has the name and telephone number of the Titas gas field written on it. Drilled in 1969, the gas field had 16 gas wells with a production capacity of over 400 million cubic feet per day (Mcf/day), while the country's total average daily demand was 1,600 Mcf/day until the middle of the current month. The highest one-day production reached 1,670 Mcf/day in April, yet the Bangladesh Power Development Board (BPDB) claims shortage of gas supply for generation of electricity.

It may also appear interesting that the Titas field, with the remaining recoverable reserve of "perhaps" over 2 trillion cubic feet, had the capacity to produce more. Yet, it is an irony that the former energy advisor, Mr. Mahmudur Rahman, is alleged to have allowed the system to create an artificial shortage in gas supply, and cleverly instructed the IOCs to produce more gas. In fact, he prompted Unocal/Chevron to quickly start production from the Bibiyana gas field so that Bangladesh could buy back it own gas at a much higher price, that too in dollars, and sell at a lower price, thus hurting the interest of the nation.

Bangladesh Gas Field Company Ltd (BGFCL) had enough "surplus funds" sitting in the bank; and the government had sufficient time to ask Bapex to drill 5 to 6 wells during 2005-06, and increase the production capacity to another 160-180 Mcf/day through drilling at Titas and Habiganj gas fields in the first phase.

In the second phase, another 5-6 production wells and necessary physical infrastructure could be created to improve the overall gas supply system in the country. But, he did not. One can safely point fingers at the Ministry of Energy in general and Mr. Mahmudur Rahman in particular. I am, however, not sure whether Petrobangla submitted any development plan to that effect. If so, what happened to that plan?

I said "perhaps" the reserve of Titas gas field is over 2 Tcf because, in the absence of a proper computer analysis based on well report and also the certification by an internationally reputed independent specialist company, it is not advisable to state the proven reserve figure. Unocal tried once in the late 1990s, but the cat came out of the bag.

The story is that immediately after drilling only one well, the company declared (for Bibiyana) a reserve figure of 6.3 Tcf! That was the time when Unocal, in connivance with the Ministry of Energy, was desperately trying to export gas to India. People challenged the unholy plan and it was aborted, and the state minister, Mr. A.K.M. Mosharraf Hossain, was exposed.

He tried another illegal process -- got caught and was removed from the position. Finally, Petrobangla, on our insistence through the media, was obliged to ask Unocal to follow the international gas field practices, which they did, and came out with a local proven (P1), plus probable (P2), reserve figure of 2.4 Tcf/in 2000, almost 38% of the company's quoted number in the late 1990s.

Mark Twain once commented that some people use statistics the way a drunk uses a lamppost -- not for light, but for support. Some people use events in just this way. The then energy secretary, Dr Taufiq-e-Elahi, perhaps did not appreciate Mark Twain's comment, and allowed M/S Cairn to start production in the off-shore Sangu gas field without even proper estimation of reserve, let alone international certification.

Today, M/S Cairn is carrying out a production schedule for an "unknown" proven reserve. This is against commercial/business ethics. In about nine years, the gas production from Sangu has drastically reduced to about 60% of the previous production of 160 Mcf/day. Apparently, this offshore geological structure may also face a fate similar to that of the on-shore Bakhrabad gas field soon!

Dr Elahi also created another controversy in the case of the Magurcharra blowout, which deserves a careful investigation now. The Tengratilla case is yet another example of the mind-boggling corruption of two secretaries of the ministry of energy, and includes Mr Akmal Hossain as well.

The energy sector is now faced with a disaster type situation in the country's largest gas field. I would humbly urge the energy advisor not to take the gas-firing issue of the Titas gas field casually. Rather, a thorough field investigation should be undertaken, both for finding out the cause and the effects of the incident, and also the financial loss incurred so far (about $ 100 million at $3/Mcf) due to the gas flare etc. Also, a proper and thorough investigation of the personnel involved, including the role of the secretary, Mr. AM. Nasiruddin, who also happens to be the chairman of the BGFCL Board, seems necessary.

The question that arises is whether the BGFCL board ever discusses this issue? If so, what was their recommendation? Another bewildering thing is the spewing out of gas, and the sporadic gas leakages over the past several months. Did that ever strike the mind of Mr. Nasiruddin? If it did, couldn't he seek external professional assistance to handle this crucial problem?

Did he ever pick up his official telephone and talk to our high commissioner in London, or the ambassador in US or Japan, and seek advice in this regard? It is known to many people in the energy sector that there are specialist companies, who deal with such gas or oil-field fire hazards.

Gas and energy are already well on the way to becoming the hottest cauldron in national politics, made all the more difficult by the shortages in supply. Due to Titas gas field disaster, Bangladeshi people became panicky. Nevertheless, the nightmare has exposed a new weak link of the professional management capacity.

But we are afraid that the authorities will have trouble when it comes to reading the public mood.

We may recall that well number three in the Titas gas field was drilled in 1969, to a depth of 9315 feet, by M/S Shell Oil Company. In total, four production wells were drilled during 1962-69, i.e. prior to the liberation of Bangladesh in 1971. All the other 12-gas wells were drilled during 1981 to 2000-02. Well number ten also remains vulnerable from the point of view of sustained production.

Indeed, proper supervision and monitoring are lacking in all the sixteen gas wells at Titas, which produce almost one fourth of the total daily demand. Therefore, we must not only care about the production wells per se, but also make an action plan to drill more wells in the coming years. Indeed, the government should be morally compelled to do something, and to be seen doing something positive, something that would offer a long-term solution in the gas domain.

We humbly submit to the honorable chief advisor to kindly ask the authorities to thoroughly investigate the Titas gas flare matter. But much before that, maybe today, ask them to seek international expert services because, whatever excuses the Ministry of Energy or BGFC offers, the field situation is still unclear.

The Gas Sector Master Plan (GSMP), 2005, has already given warning that Bangladesh has only sufficient proven gas reserves to fully meet the demand until 2011, although, taking into account probable reserves, this extends to 2015.

Unfortunately, the government has not clearly defined its vision for the gas sector for the next 20 years. Yet, the aspiration of each principal stakeholder is said to have been ascertained, and an achievable investment portfolio has also been made. In this situation, the nation cannot afford to waste even one Mcf of gas. If anyone does so, he should be punished.

Mr. Nuruddin Mahmud Kamal is former Additional Secretary and former Chairman, Power Development Board.