India’s ONGC mulls investments linked to gas blocks in Bangladesh

11 September 2013 06:41  [Source: ICIS news]

KOLKATA (ICIS)--India’s ONGC Limited is planning fertilizer and petrochemical projects in Bangladesh linked to two shallow-sea gas blocks to be formally awarded to the oil exploration and production (E&P) major by Dhaka later this month, a company official said on Wednesday.

Two shallow-sea blocks’ award to ONGC and one to US company ConocoPhillips will be finalised by the Bangladesh’s Cabinet of Ministers by end-September, the official said.

According to the terms of bids, ONGC will supply 60-85% of gas and 85% of oil to the Bangladesh government, the official said.

ONGC was planning fertilizer and petrochemical projects linked to the residual availability of gas and oil from these two blocks leveraging its upstream and downstream experience in north-eastern Indian province of Tripura, bordering Bangladesh, he said.

The two shallow-sea blocks—SS-04 andSS-09- were to be awarded to ONGC as it was the sole bidder and the E&P major would also have the right to explore another offshore gas field of Kutubdia, also on the Bay of Bengal.

The parameters and investments of the fertilizer and petrochemical projects will be determined only after ONGC has completed 2-D and 3-D seismic survey and drilled development wells to get an idea on the total recoverable oil and gas production.

ONGC, has some of the highest success rate in drilling for gas in Tripura, striking gas in one out of every two wells drilled, the official added.

Indian government majority-owned ONGC had also tied up with private sector, Chambal Fertilizers and Chemicals Limited, to implement a 1.3m tonne/year urea production plant using gas as feedstock entailing an investment of $781m (€586m). It is scheduled for completion in 2017.

The company was also exploring marketing options for urea, in the fertilizer deficient markets in Bangladesh using inland waterways linking the two neighbouring countries, the official added.

($1 = €0.75)

Author: Ajoy K Das

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