The country's gas reserves are running out. Production is declining continuously. If new gas fields are not discovered and extraction from new mines is not started, domestic reserves may run out in the next eight years.

Currently, 1.8 billion cubic feet of gas is extracted from domestic gas fields per day. In 2017, it was around 2.7 billion cubic feet. That is, domestic gas extraction has decreased by 33 per cent. When production from domestic sources decreases, dependence on gas imports increases. For that, a large sum of foreign currency has to be spent which affects foreign currency reserves.

In 2018, the then Awami League government started importing gas. It was a major reason behind the increase in the price of the dollar to 123 taka and the hike in the prices of all products. Subsequently the country’s forex reserve started declining while pay for the import and the price of dollar has been increasing since then. Along with this, gas prices have had to be increased in phases.

It is the common people who will have to pay for this. The prices of cooking oil, sugar, and other essential goods would not have risen so much, and the cost of living would not have increased to this extent, had the government been able to keep prices under control by increasing the production of natural gas from domestic gas fields.

The cost per unit (cubic metre) of domestic gas is around Tk 3, while importing it from abroad costs about 55 taka. This low cost is due to the current low price of gas.

Economists and industrialists say that US President Donald Trump's imposition of tariffs on various countries has created an opportunity for Bangladesh's export sector and investment. To seize this opportunity, a secure and affordable energy supply is essential, making it crucial to increase the production of domestic gas. The government understands this and has taken initiatives to boost domestic production.

Muhammad Fouzul Kabir Khan, the adviser to the Ministry of Power, Energy, and Mineral Resources, told Prothom Alo that three strategies have been adopted, considering the country's gas reserves: increasing production by drilling more wells, expanding gas exploration on land and at sea to discover new reserves, and constructing a land-based terminal to increase import capacity. In addition, gas usage will be controlled by preventing theft and waste.

How much is left?

According to sources at the Bangladesh Oil, Gas, and Mineral Corporation (Petrobangla), the last survey on the country's gas reserves was conducted in 2010. At that time, a foreign company scientifically calculated the reserves, which were estimated to be 28.79 TCF (trillion cubic feet) of extractable gas. By the end of the 2022-23 financial year, 20.33 TCF of gas had been extracted, leaving approximately 8.5 TCF in reserve.

In 2023, Petrobangla had the gas-extracting companies conduct a new review of the reserves. This review found that by the 2023-24 financial year, the reserves stood at nearly 30 TCF. However, by that time, approximately 22 TCF of gas had been produced, leaving about 8 TCF in reserve.

Currently, the country produces an average of just under 0.75 TCF of gas per year. At this rate, the remaining reserves are expected to last for another 11 years. However, experts say that a significant amount of gas must be left in the mines at the end of extraction because it is no longer commercially viable to extract, even though it is counted in the reserve figures. Taking these factors into account, experts estimate that the remaining gas will last for about eight more years at the current extraction rate.

Reserves at each field

According to Petrobangla, there are currently 29 gas fields in the country, with 20 of them in production. Of the remaining fields, four have been discovered but are not yet extracting gas. These are Ilisha and Bhola North in Bhola, Zakiganj in Sylhet, and Kutubdia. The necessary pipelines and other infrastructure to extract gas from these fields have not yet been built.

Production has been stopped at various times in the remaining five fields even though they contain 661 BCF (billion cubic feet) of gas, as this gas is not commercially extractable. These fields are Rupganj in Narayanganj, Chhatak in Sylhet, Kamta in Gazipur, Feni, and Sangu (Chattogram).

As of 1 July 2024, the remaining reserves in Titas, Brahmanbaria, are almost 2 TCF. Bibiyana, in Habiganj, holds 1.66 TCF, and Moulvibazar, in Sylhet, has about 20 BCF of gas. Jalalabad has less than 700 BCF in reserve. The remaining fields, including Bakhrabad, Kailashtila, and Rashidpur in Sylhet, also have a moderate amount of gas reserves.

A bias towards imports

The Awami League government, which was ousted in the July mass uprising, abandoned gas exploration in favour of imports. At that time, two terminals were built in Moheshkhali, Cox's Bazar, where ships would bring in Liquefied Natural Gas (LNG), which was then converted and sent into pipelines.

Gas imports began in 2018. At the time, the price of gas on the world market was low, and the country had sufficient foreign currency reserves. However, many people warned even then that the economy could face a crisis if prices rose abroad. When the war between Russia and Ukraine began in February 2022, global gas prices surged, putting Bangladesh in a difficult position.

In 2018, Bangladesh bought gas at a rate of USD 4 MMBTU (British Thermal Unit). By 2022, that price had risen to 60 dollars. Along with gas, the price of other goods also increased, raising the country's import costs. The dollar reserves fell, and the price of the dollar began to rise. Due to the dollar shortage, the import of gas from the open market had to be stopped for seven consecutive months in 2022. The previous government also created a huge debt, which the current government has now paid off. However, the price of LNG on the world market is now below 15 dollars.

Khondaker Golam Moazzem, the research director for the private research organisation Centre for Policy Dialogue (CPD), told Prothom Alo that the current government is having to deal with the situation created by the previous government's flawed policies and plans.

However, he noted that the current administration also appears to have a greater inclination towards LNG imports than exploration. He stated that with low foreign currency reserves, there is no opportunity to show the luxury of importing gas from abroad. The negative economic impact of this is well known. What is needed now is to take the initiative for an alternative solution.

Initiative for drilling wells

Under pressure, the Awami League government took an initiative in 2022 to increase domestic production. Petrobangla states that a plan was then made to drill 50 wells, including those for exploration, workovers, and development. If this plan were implemented, it would add about 650 million cubic feet of gas per day to the national grid, although it was not a top priority. The interim government, however, has placed a strong emphasis on drilling wells. A new plan to drill 100 more wells has been taken up. As a priority to increase gas production, the government is focusing on rehabilitating 31 old wells, as rehabilitation offers an opportunity to boost production.

Drilling wells in potential gas fields helps confirm whether gas is present. If found, extraction begins through the well.

Md Rezanur Rahman, chairman of Petrobangla, told Prothom Alo that it is difficult to see results quickly when it comes to increasing gas production. He said that contracts have been finalised for most of the well work. The work on several wells is in its final stages. From November onwards, new gas will be added to the grid every month. In addition, preparations are being made to drill 100 more wells starting next year.

The Energy Division says that a project for 50 wells, including rehabilitation, development, and new drilling, is currently underway. Overall, domestic gas production is likely to increase over the next two to three years. Based on our conversation, here is the British English translation of the Bengali text you provided.

How far is the search for new gas fields?

The country's largest gas field, Titas in Brahmanbaria, was discovered in 1962. The last major gas field found was Bibiyana in Sylhet in 1998, which now produces the most gas. Since then, no other major gas field has been discovered. The most recent discovery was the Zakiganj gas field in Sylhet in 2021, though its reserves are only 52 BCF.

There is potential for gas in Bangladesh's maritime boundary in the Bay of Bengal, and a multi-dimensional survey has also indicated this. However, no gas has been discovered at sea so far, even though both India and Myanmar are extracting significant amounts of gas from the Bay of Bengal. Petrobangla has drafted a new production sharing contract (PSC) for gas exploration within Bangladesh's maritime boundaries and has sent it to the ministry. It should be noted that the maritime boundary disputes with India and Myanmar were settled in 2012 and 2014, respectively.

Badrul Imam, a geologist, told Prothom Alo that Bangladesh has immense potential for gas, but only a very small portion of that potential has been discovered. He says that the discovery of one gas field increases the likelihood of finding another, but policymakers are unwilling to pursue this. No government focuses on exploration. He said that widespread exploration is necessary and that the government should take swift action.

‘We want gas at an affordable price’

Gas and electricity are essential to run factories, and gas is needed to produce electricity. Without new investment, employment will not increase, and young people will not find work. As a result, people's livelihoods and the country's economic progress depend heavily on gas. Maintaining the industrial sector's capacity requires gas at an affordable price.

In January 2023, the previous Awami League government increased the price of gas for industries by up to 179 per cent. At the time, it was said that this was necessary to increase imports. However, the then-government failed to increase imports despite raising the price. The current government has raised the gas price for new connections by 33 per cent, and imports have now increased slightly.

Fazlul Haque, the former president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told Prothom Alo that Bangladesh's export sector has a lot of potential. He said that the biggest issue for preparing to seize this opportunity is the uninterrupted supply of gas and electricity. He added, "We want gas at an affordable price. To achieve this, it is crucial to increase domestic production instead of relying on imports. Strong measures in this regard should have been taken a long time ago."

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