Bangladesh is considering buying Chevron Corp’s interest in three natural gas fields in the country, worth an estimated $2bn, two senior government officials said, as Dhaka looks to secure the supply of a critical source of energy.
Chevron, the second-largest US-based oil producer, said in October last year that it plans to sell about $10bn of assets by 2017 amid a prolonged slump in energy prices. Chevron recently said it is in discussions about the potential sale of three fields it operates in the northeast of Bangladesh.
Dhaka sees the gas fields, which account for more than half of the country’s production, as a matter of “national interest” and a purchase is on the table, said Istiaque Ahmad, chairman of Petrobangla, the state-owned oil and gas company, on Thursday. He added, however, that their efforts were at a preliminary stage.
Ahmad said Petrobangla was waiting for Chevron to approach it about a bid. Petrobangla is also likely to appoint a consultancy firm to assess the assets, including proven and recoverable gas reserves, to arrive at a valuation, he said.
A Chevron spokesman said the company has been in commercial discussions about its assets but no decision had been made so far to sell them.
“We will only proceed if we can realise attractive value for Chevron,” the spokesman said in an e-mailed statement yesterday.
Bangladesh officials have said that the South Asian nation of 160mn needs more energy to realise its vision of becoming a middle-income country by 2021. The country is currently short of about 500mn cubic feet a day of gas, according to the energy ministry.
Bangladesh will buy the assets through an open bidding process, a government source said last week. “Why should we hand it over to someone else?” the source said.
Dhaka’s interest would likely make it harder for a third-party to buy the assets. The Chevron unit sells its entire output from the three fields to Petrobangla under a production sharing contract.
Under the terms of the contract, the Bangladesh government has the right of first refusal in any asset sale, Mohammad Hussain Monsur, former Petrobangla chairman, said yesterday.
Monsur also said that funding the purchase of the assets would not be a problem since the country could rely on its foreign exchange reserves, which stand at more than $31bn.
In 2015, Chevron’s net daily production in the country averaged 720mn cubic feet of natural gas and 3,000 barrels of condensate, accounting for more than half the gas
production in Bangladesh.