Seven international oil companies have submitted their bids for 15 offshore blocks in an apparent lukewarm response to energy-starved Bangladesh's exploration move amid growing demands for gas and power, officials said on Thursday.
The state-run Petrobangla officials said the oil companies offered to invest $ 1.6 billion for 16 out of 28 blocks offered for the exploration as they opened the tender documents two months after the country launched its first offshore bidding round.
The off-shore bidding round was announced in February with 20 deep sea blocks and eight shallow water blocks -- each having exploration area cover between 3,000 and 7,000 square kilometres.
"Twenty-five companies have purchased our promotional package and seven of them submitted bids. We are satisfied with the outcome," a Petrobangla spokesman told PTI.
Quoting energy analysts, the Daily Star said despite huge prospects, the bid failed to generate a lot of offers; Petrobangla did not stage any road shows abroad to attract oil companies.
Moreover, it said, currently some other countries are holding their own block bidding, which kept many oil companies pre-occupied while doubts about maritime boundary of some blocks close to India and Myanmar might have discouraged bidders to go for several of the 28 blocks.
Santos International of Australia appeared as the top bidder, making a total investment proposal of $ 852 million under three Production Sharing Contracts (PSCs) for six blocks in partnership with British Cairn Energy, if it is selected.
US-based company Conoco Phillips submitted four bids for eight deep sea blocks as the company intends to sign four production sharing contracts, each for two blocks.
A US-China joint venture, Longwoods Resources, has submitted a bid for one shallow sea block and two deep sea blocks. According to Petrobangla documents, the second round block bidding in 1998 generated offers from 22 oil companies, of which Shell Oil alone offered to invest over $ 2 billion.
Analysts earlier called this round of bidding 'crucial' for Bangladesh's energy sector as the country desperately needs to find new gas reserves as the gas crisis is projected to be acute after 2011.
The industries have long been complaining about the gas shortage hampering the production while concerns were increased last week with a government statement announcing restrictions of new gas connections in view of dwindling reserves.
Special assistant to the chief adviser on energy ministry, M Tamim, last week said no further gas connections would be given in south-eastern Chittagong port city, known for its industrial importance.
He said in view of the gas shortage and that the authorities were also going slow and maintaining a cautious approach in giving new gas connections to industries in Dhaka and adjacent areas.