Dhaka court halts gas export to India for three months

Dhaka, Dec 6: The Bangladesh high court has blocked for at least three months a government move to export natural gas to India through a pipeline, energy ministry officials said here on Thursday.

They said the court issued an injunction on Wednesday stopping gas export through in violation of production-sharing contracts the government signed with foreign oil companies. The injunction, which may be extended, followed a writ petition in 1998 by a group of professionals.

After the October 1 general elections, the government headed by Begum Khaleda Zia has immediately initiated a move to export gas to India, despite the fact that she had vehemently opposed the move when she was in the Opposition. The previous Sheikh Hasina government had signed several PSCs allowing compressed natural gas export but not the export of raw gas.

The high court also imposed a three-month ban on signing any new product sharing contracts as well.

Dhaka has been under pressure from foreign oil companies and international donors to export gas to build up its foreign exchange reserves as also boost its economy.

A group of Bangladeshi geologists on Wednesday told a seminar that current gas reserves would be exhausted by 2015. “The proposal for exporting gas to India through a pipeline, if implemented, will make all future gas-based plants uncertain,” one geologist said.

Officials of Unocal Bangladesh, a subsidiary of Unocal Corp of the US, had earlier said it planned to lay a 30-inch, 1,363-km-long pipeline to initially carry 500 million cubic feet gas a day from the Bibiyana field in North-East Bangladesh to New Delhi. The project would entail an immediate investment of $500-$700 million and Bangladesh could earn $3.7 billion from the project over a 20-year period, they added.

Unocal submitted the plan to the government late last month. Bangladeshi power minister AKM Mosharraf Hossain has said his country will assess its gas reserves and domestic requirements before making a decision whether to export.

A recent report by the US Geological Survey indicated that Bangladesh could have 32.1 trillion cubic feet gas reserves. Bangladesh has proven reserves of more than 12 trillion cubic feet gas, enough to cover the domestic demands for 15 years, according to an unofficial estimate.

But the Bangladeshi Opposition, including Ms Hasina’s Awami League, and local experts are opposed to idea of gas export unless there is a surplus after estimated domestic needs for the next 50 years have been met, and had protested the government plan by staging a half-day national strike last month.

— Reuters