To overcome gas crisis, upgrade field management
The depleting reserves of most major gas fields, decline in cumulative gas production, and disruption in the expected LNG supply mean that Bangladesh is going through the worst gas supply shortfall in recent history. This is not unexpected by any means, because energy experts, for a long time, have been warning about a major gas crisis coming due to the widening gap between the supply and demand of gas in the country.
On the supply side, local gas production has declined from a peak annual rate of 973 billion cubic feet (Bcf) in FY2016 to 840 Bcf in FY2022, according to Petrobangla. The increasing industrialisation and urbanisation over the last decades, on the other hand, led to a fast uptick in gas demand. The attempt to remove the gap by supplementing the gas supply through liquefied natural gas (LNG) import did not bear the expected result, because Bangladesh cannot import enough LNG to meet its requirement for two reasons. First, the price of LNG is very high and the country currently has a dollar crisis, which would not allow the funds readily available to pay for the import bill. Second, the country has yet to build a robust LNG import infrastructure.
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Waning reserves, falling production
In the 1960s, the Shell Oil Company helped place Bangladesh (then East Pakistan) on the world map for gas reserves by discovering several world-class multi-Tcf (trillion cubic feet) gas fields, including Titas, Habiganj, Bakhrabad, Kailashtila and Rashidpur. After independence, new gas fields were discovered on a regular basis, but that did not significantly change the reserve situation, because most of the newly discovered gas fields were relatively smaller in size. In 1997, Bibiyana, yet another multi-Tcf gas field, was discovered by a major international oil company (IOC).
Among the very large gas fields, Titas' initial gas reserve was estimated to be 6.36 Tcf in 2010. At the beginning of 2023, the Titas gas reserve declined to 1.14 Tcf, per Petrobangla data. Similarly, Bakhrabad's initial reserve was estimated to be 1.23 Tcf, which has been reduced to only 0.35 Tcf. Habiganj, another major gas field, has been depleted from the initial reserve of 2.63 Tcf to 0.097 Tcf. The reserve in Bibiyana, the gas field with the highest production volume in Bangladesh, has declined from the initial 5.75 Tcf to 0.33 Tcf at present. The same trend is visible in some other large gas fields. The Sangu, the only active offshore gas field in the country, has been completely depleted and abandoned.
From the above, it is clear that most of the currently operational gas fields are past their youthful strength and cannot be relied upon for meeting our gas needs in the future. To attain future gas security, Bangladesh has to enter a robust exploration programme to find yet-to-find new reserves of gas.
At present, Bangladesh reels under a severe gas supply shortfall. About 78 percent of the gas supply is met through production from local gas fields. The remaining 22 percent is met with imported LNG. While domestic gas production has been on the decline for several years now, the LNG supply suffers from international price hikes and poor LNG infrastructure. The production facilities in local gas fields do exhibit various weaknesses, including less-than-optimum production volume per well compared to IOC wells. Energy experts opine that there is a scope for enhancing the rate of production in individual wells in the national gas fields.
How to boost gas production
The present gas crisis is more of the result of failure to exploit our gas resources enough, rather than the lack of it. That means we may add more gas to the production line if better technology and management are employed.
There are two ways the gas output may be increased. Production may be increased by drilling more development wells in the known reserves. The Chhatak gas field, for example, has a large reserve, but it has never produced through more than a single well. Largely untapped, the gas field, which faced a blowout accident in the late 1980s, still has the potential of production at a healthy rate.
In the Titas gas field, the largest gas field in the country, 26 wells have been drilled, and it currently supplies 390 million cubic feet per day (mmcfd) of gas to the national grid. In comparison, IOC-controlled Bibiyana, the second largest gas field with 26 wells drilled, produces 1,180 mmcfd—three times more than Titas.
Kailashtila and Rashidpur gas fields, two of the five largest fields in Bangladesh, do not produce even close to their capacity. Kailashtila produces only 25 mmcfd and Rashidpur produces only 42 mmcfd. Comparatively, the IOC-controlled Jalalabad gas field, with about half the reserve of either Kailashtila or Rashidpur, produces about 150 mmcfd. These are clear evidence of the underdevelopment of the nationally managed gas fields. Gas field development is not rocket science; simple improvement in technological and operational procedures can enhance production.
In 2011, internationally renowned oil-gas service company Schlumberger was engaged by Petrobangla to find ways to increase the production rate of individual gas wells in several gas fields across Bangladesh. Schlumberger detected 49 wells that it thought were underperforming and suggested procedures to enhance the production rate in those wells. These were procedures designed to perform from the surface, involving minor issues of wellhead repairs, adjustment and additional instrumentation, including higher diameter tubing. No subsequent follow-up of the recommendations was ever done; the technical report has been gathering dust till date.
So, it appears that the local companies dealing with production in the nationally managed gas fields need to upgrade their technology to a more upscale system. A comparison between the production of a gas well operated by a national company with that of an IOC-managed gas well makes this point evident. Bangladesh needs to catch up with modern technology to stand on par with the international standards.
Dr Badrul Imam is honorary professor at the Department of Geology in the University of Dhaka.
Views expressed in this article are the author's own.
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