Occidental To Invest $200 Million In Bangladesh

Occidental Petroleum Corp will invest $200 million in a natural gas exploration venture in Bangladesh, company president Roger Abel was quoted as saying.

Occidental will conduct a seismic survey, dig three exploration wells, three development wells and one workover well, the daily Independent newspaper quoted Abel as saying in Dhaka yesterday.

Abel said his company expected to produce 100 million cubic feet of gas per day from the northeastern Jalalabad gas field by the end of this year.

The company, which has had a troubled history in its Bangladesh operations, would also construct a gas treatment plant at Jalalabad and lay pipelines, he said.

 

Officials with state-owned oil and gas company, Petrobangla, yesterday said the American firm would soon be given an extension on its unproductive first three-year contract for exploration. The contract expired on January 10, 1998.

The government is favourably considering the renewal of the PSC (production sharing contract) with Occidental for block 13 and 14, Mosharraf Hossain, chairman of Petrobangla, said.

He said the review was in the final stage and there is a bright possibility of allowing the company to undertake exploration work.

Occidentals first three-year contract came to an abrupt halt when a drilling rig in northeastern Magurchhara gas field exploded at its first exploratory well in the area.

The fire destroyed drilling equipment and burnt down forest and tea plantations. Many local tribal families abandoned their homes as they fled the blaze which lasted for months.

Occidental finally sealed the well in January, six months after the accident.

Ministry officials said the company had violated the contract which had required the company to drill three wells.

Occidentals head of Bangladesh operations, Nigel Hopkinson, declined to comment on the issue, saying the matter was being discussed with the government.

Occidental was one of the few foreign companies to sign a PSC in 1994 following Bangladeshs first round of bidding. It was awarded three blocks.

Petrobangla officials yesterday said Occidental would now drill wells in other locations, designated under the first contract.

They said the company was allowed to continue its work in two other prospective gas fields despite its failure to fulfil its first contract.

Occidentals Abel said his company was now drilling exploratory wells in a gas field in northeastern Bibiyana.

According to Petrobangla officials, Occidental was confident about the prospect of its Bangladesh venture, especially after Abel met Prime Minister Sheikh Hasina on Monday.