Sylhet gas well lies idle as govt buys costly LNG

The Rashidpur Gas Field authorities in Sylhet are going ahead with setting a 17km new supply line for its well no 9, while Petrobangla and energy division officials think only a 3km line would be enough to supply gas from the well.

The state-run company's alleged craving for the new project has led to no production from the well for years, causing the government to spend an extra amount on purchase of liquefied natural gas (LNG) from the spot market.

Around 10 million cubic feet per day (mmcfd) could be produced from the well but the government has to spend Tk3 crore daily and Tk90 crore monthly to buy the amount from the spot market.

However, the field operator – Sylhet Gas Fields Limited – has stayed away from reducing the government expenditure amid a period of crisis.

Instead, the company has tended toward an increase in government expenditure as it has opted for a new gas pipeline despite the fact that a pipeline already exists. 

Sources at Petrobangla and the Energy and Mineral Resources Division have alleged that the Sylhet Gas Fields authorities are rather keen on taking up a new gas pipeline project which will allow it to handle a sizable fund.

"The gas field already has a pipeline to supply its products to the national gas grid. Sylhet Gas Fields can evacuate the gas by installing an additional 3km line, which would be linked to the existing one. Instead of doing so, the company is now marching ahead with a 17km fresh pipeline project," said one of the sources, wishing to remain anonymous. 

Md Mijanur Rahman, managing director of Sylhet Gas Fields Limited, has, however, refuted such claims.

"The existing pipeline dates back 22 years and has been abandoned due to corrosion by sand and water. It is not possible to supply gas from the Rashidpur-9 well through the existing pipeline," he said.

"We have already had the pipeline checked by a third party, which found it unfit for further gas supply," added the managing director.

Petrobangla – Bangladesh Oil, Gas and Mineral Corporation – says that the Rashidpur-9 well was drilled in 2017 but has been left unproductive since then.

Meanwhile, apart from long-term contracts, the government has been importing expensive LNG from the spot market to meet the growing gas demand at home amid dwindling production in the local gas fields.

Currently, spot LNG price is $38 per mmBtu. The price for the same quantity of local gas is around $2.

Every month, the government spends around Tk90 crore on importing 10mmcf gas from the spot market.

But production of a similar quantity of gas has remained idle on the issue of the Sylhet Gas Fields' demand for a new pipeline project.

Despite revocation from Petrobangla, the field operator introduced a project to set up a 6-inch 17km high-pressure gas gathering pipeline from Rashidpur-9 to Rashidpur Gas Process Plant.

Currently, the contractor appointment process for the project is underway. To this end, Sylhet Gas Fields floated tenders on 24 March and the bid submission ended on 27 April.

The tender process is currently at the evaluation stage, said Md Mijanur Rahman.

Talking about gas supply, he said that supply of gas from this well will begin by March 2023.

At present, the Rashidpur Gas Field has five wells in production, producing 43.8mmcf gas per day while the country's total gas production is 2,305.4mmcf from local fields.