The state-owned energy company Petrobangla on Tuesday signed a deal with South Korean resource developer Posco Daewoo Corporation for exploration of gas and oil on 12 block in the deep sea.
Deputy Secretary of Energy and Mineral Resources Division Khadiza Nazneen, Secretary of Petrobangla Syed Ashfaquzzaman and Vice President of Daewoo Se Bo Jo signed the production sharing contract (PSC) on behalf of their respective sides at Petrobangla office in the capital's Karwan Bazzar area.
Earlier on December 7, 2016, Petrobangla signed an initial agreement with Posco Daewoo Corporation for gas exploration in deep-sea block-12 in the Bay of Bengal.
Prime Minister's Power, Energy and Mineral Resources Adviser Dr Tawfiq-e-Elahi Chowdhury, Bir Bikram, witnessed the signing ceremony as the chief guest, while State Minister for Power, Energy and Mineral Resources Nasrul Hamid present as the special guest.
Dr Tawfiq-e-Elahi Chowdhury urged Daewoo to complete the exploration work within shortest time, adding, "We have given importance for four topics including survey, exploration, well digging and LNG import aimed at ensuring energy security."
According to the contract, the international oil company (IOC) would explore gas and oil from 1,000 to 2,000 metres in the deep sea of the Bay of Bengal and sell gas and oil at competitive prices with profit from 65 percent to 90 percent in oil and 85 percent from 60 percent in gas.
The duration of the agreement would be five years in primary level, but the contract would be flexible for increasing its period to three years more.
The government has signed the agreement for exploration of the gas and oil from the deep sea after wining of the maritime boundary from Myanmar and India.
Posco Daewoo now produces 500 mmcfd of gas in Myanmar and South Korea, according to several media reports.
Posco Daewoo estimates that the Myanmar gas fields have 4.5 trillion cubic feet of reserves, enough to cover three years of liquefied natural gas supplies to Korea, reported the Pulse News of Korea on November 2016.
Posco Daewoo hopes it could dig up similar yield from Bangladesh, according to the report.