Chevron keen to invest $ 650m more in oil, gas

US oil and gas giant Chevron is eyeing to invest more in oil and gas exploration activities in Bangladesh to meet the country’s mounting energy demand, Chevron Bangladesh President Geoffrey Strong told the FE Tuesday.

Chevron has already invested around US$1.5 billion in the past one decade’s operation in Bangladesh, he said.

chevron-logo-promoAfter commencement of the $500 million Bibiyna Bibiyana Expansion Project, Chevron has submitted a fresh investment proposal worth around $650 million to state-run Petrobangla to install two compression stations in Bibiyana and drill more wells in Jalalabad gas field.

“We received the investment proposals from Chevron and are currently examining it,” Petrobangla’s director for production-sharing contract Md Quamruzzaman said.

Speaking to the FE, Mr Strong said, “The country requires increased exploration and development efforts for the low-cost energy source natural gas to address its current primary energy crisis.”

To accomplish this quickly, the government should harness the capabilities of not only Petrobangla and state-owned Bangladesh Petroleum Exploration and Production Company Ltd (Bapex), but also other competent investors, he said.

“This needs to be done urgently before Bangladesh’s gas production begins to decline. In the long-term, all forms of energy will be required to meet Bangladesh’s growing needs including more expensive coal, LNG, solar and possibly nuclear energy,” he added.

Spelling out his firm’s interest for further investment in Bangladesh, Mr Strong said, “Chevron has the organisational, technological and financial capabilities that can be harnessed by Bangladesh to find and develop more gas resources for the nation,” said the Chevron top brass.

The country requires more investment onshore and offshore to protect the country’s energy security and Chevron has a long history of demonstrated performance in growing our production, he added.

Domestically-produced natural gas is currently about one-fifth the cost of imported fuels such as diesel, furnace oil, liquefied petroleum gas (LPG), and liquefied natural gas (LNG).

“It is very gratifying to see that the low-cost gas we produce plays such an important role in driving the Bangladesh economy and fuelling the growth of its many businesses,” he said.

“I think, everyone realises there is a serious shortage of energy in Bangladesh. The lack of energy is constraining economic growth and impacting daily life. Solving the energy crisis is going to require help from everyone,” he said.

It is great to see the Petrobangla stepping up its exploration and development activities, said Mr Strong.

“But we believe more should be done. We are working with the government to find areas where Chevron can help do more to not only find and develop more gas, but also to help the Petrobangla build its capabilities,” he said.

Chevron is the largest producer of natural gas in Bangladesh, currently delivering over 50 per cent of the country’s total supply.

The US company has increased production from 300 million cubic feet per day (mmcfd) in 2005 to over 1,200 mmcfd currently.

“We are also the country’s largest foreign investor, having invested over $1.5 billion to date. In addition, Chevron is the highest corporate taxpayer in Bangladesh,” said the Chevron Bangladesh President.

“We employ over 4,000 smart hard-working Bangladeshis, and our community development programmes collectively reach over 30,000 people living near our areas of operation,” said Mr Strong.

Chevron operates three gas fields and a compressor station all located in the Sylhet region of northeast Bangladesh.

It recently announced the commencement of natural gas production from the $500 million Bibiyana Expansion Project.

“This flagship project is the largest foreign investment project in Bangladesh’s history. Once fully operational next year, the project will deliver an additional 300 mmcfd of natural gas per day, and 4,000 barrels of condensate,” he said.

Chevron’s other key project is the Jalalabad drilling programme.

“In Jalalabad, we plan to complete drilling three new-producing wells early next year. These new wells will help maintain the current production levels there for a few more years,”

Regarding corporate social responsibility (CSR) , he said Chevron is very active in its social responsibility efforts.

“As we find all over the world, our business is more successful if the communities where we operate are successful,” he said.

These communities see the huge economic benefits from Chevron’s operation and they want to share it.

Chevron focused on three core areas – economic development, education and health, he said.

“In the area of health, we deliver 130,000 patient services per year to local communities through Chevron’s sponsored three Smiling Sun Clinics. On education, Chevron has provided 1,500 scholarships per year and support to 60 schools in partnership with Save the Children. In terms of economic development, over 5,500 families are currently engaged with our economic development programmes, and more than 2,000 new enterprises have been created since 2006,” he said.

“Chevron in October announced a new $10 million five-year programme, which we call the Bangladesh Partnership Initiative that will expand our economic development activities,” he said.

This $10 million social investment initiative is focused on supporting economic development in the communities around our operations in the country’s greater Sylhet region over the next five years, he said.

This programme represents a significant increase in Chevron’s social investment programme, and is one of the largest corporate social investments for Bangladesh, Mr Strong said.

The programme has two main components — skill development to help community members get jobs, and enterprise development to create more jobs.

The programme will build on Chevron’s past partnership initiatives and programmes.

“Bangladesh is one of four worldwide locations that were selected across Chevron’s global operations for major economic development programmes,” he said.

Chevron will be working with local and international non-government organisations to establish these programmes.

“We will also partner with government and other private enterprises that share our commitment to economic development in the region,” Mr Strong added.

Chevron is interested in empowering the community to help themselves, he said.

“From our experience, we have seen that when we improve economic conditions, families can provide better education opportunities for their children and take care of their own health services. We see economic development as a conduit to improvement in education and health care,” Chevron top brass said.

The country’s overall natural gas production was 2,422 mmcfd as on November 24, 2014.

Chevron alone was producing 1,227 mmcfd of gas from three of its onshore gas fields — Bibiyana, Jalalabad and Moulavi Bazar — located in blocks 12, 13 and 14, respectively, all located in the country’s northeast Sylhet region.

The country’s overall natural gas demand is around 3,000 mmcfd.

Gas shortages in Bangladesh have prompted the Petrobangla to ration new connections to industries, fertiliser factories and power plants, hindering economic growth since June 2009.

Source: Financial Express