Committed to PEOPLE'S RIGHT TO KNOW
Vol. 4 Num 300 Thu. April 01, 2004  
   
Editorial


Chronicle
Riding a roller-coaster of crises


We can hardly be optimistic about the solution of our energy problem for many reasons. Indeed, the people of Bangladesh are riding such a roller coaster of crises that we haven't taken time to catch our breaths and 'look at the big picture.' However, there may be no such thing as a crisis, to end crises. But, we can at least hope that the energy shortages for the past few years, both in electricity and natural gas, have opened our eyes to understand how connected everything is from the anklebone to the neck bone. Yet it seems that the authorities do not take adequate care to handle the energy issues of the country.

Those things apart, perhaps, it wouldn't be unjustified to mention that the next three to five years will be our greatest period of stress, before our drive toward reduced energy import can actually be materialised as we did in the 1980s. It will also be a testing period as to whether our recent experience has focused our attention on our real long-term problems or whether we are going to live from one summer shortage of gas supply to the next one. It also appears that nothing will move in a positive direction because at least one important individual in the energy domain would pretend that he is the king sitting with a magic crown on his head. His perception is that people will continue to listen to him without questioning about his ability and commitment. If this continues, we would be heading for a disaster.

It is now a public knowledge that for the past about three years everything has been let loose in the energy sector. Pardon my statement. The general allegation is that the Ministry of Energy apparently has not made any serious effort to add a single Mcf of gas in the system. But the consumption of gas has already exceeded the demand forecast of many, contradicting even the thought-process of some intellectuals. For instance, Dr AKMA Quader, Professor, Department of Chemical Engineering, BUET in the recent past has categorically distrusted the entire past Plan's gas demand projections including that of Petrobangla. Unfortunately, for him, his undue cautious forecasts have been overtaken by events. For example, Dr Quader's gas demand projections showed an average demand of 967 million cubic feet per day (MMcfd) (Peak demand 1209 MMcfd) by 2005 and 1369 MMcfd (Peak demand) by 2010 (Ref: Azim Uddin Ahmed, former Secretary, Energy, CPD presentation, May 2000). This speaks of a poor appreciation on gas development of Bangladesh. Happily, the demand forecast made by Aziz Khan of Petrobangla (1330 MMcfd by 2004) has been so correct. He deserves appreciation. But the government relies on the projections of intellectuals and theoreticians. If the authorities continue to do so, "only Allah can save the country from an energy crisis"! However, if we can deliberately make conservation and efficient energy use a national way of life, while we are increasing our supply through an effective and efficient means, we'll overcome the vicious circle. But, it seems the government prefers to continue to make mistakes one after the other and doesn't try to correct itself. I shall try to explain in the following paras why I am saying so.

Here is one such example of irregularity: On 8 Feb, 2004, an international tender notice appeared in the daily newspaper for engagement of contractor for drilling of two wells at Titas Gas Field, the largest producing field in the country. Bangladesh Gas Field Company Ltd (BGFC), a subsidiary of Petrobangla (while Petrobangla itself is not yet a holding company!) is currently operating 12 gas wells at Titas field and now intends to drill two more appraisal-cum-development wells in the same gas field. The tender document also indicates that there is a plan for drilling two more wells -- one at Habiganj and another at Narsingdi gas field, respectively. This piece of information would hopefully act as appetiser to a potential bidder. Using BGFCL's own fund, the proposed drilling would be conducted soon. So, the lobbyists are very active now.

Visibly, there is no harm in calling a competitive bidding. But the question is: why should BGFCL/Petrobangla look for an international contractor to drill two development (production) wells? Is there a shortage of drilling rigs either under Bapex or BGFCL? Or are all the drilling rigs capable of drilling up to the desired depths are committed for drilling elsewhere? I understand, the answer to both the questions is clear and simple "No." Then, for whose interest the tender is floated?

Reportedly, to meet the country's short-run gas demand, Petrobangla has already chalked out a plan to drill a total of nine wells during 2003-2007 including the already indicated two wells at Titas Gas Field. These are all approved projects. Hopefully, Unocal also would drill new development wells (for production of gas) at Moulvibazar and Bibiyana to support future gas supply for home consumption, as per demand. I am certain that it is well within the knowledge of the government that at least two efficient deep drilling rigs are available in the country. One of the rigs IPS-Cardwell is owned by BGFCL, while the owner of IDECO-1700 is Bapex. Bapex has recently carried out drilling of a well at Fenchuganj. Hopefully testing etc. would be accomplished by April/May, 2004, when the rig would be available for drilling elsewhere.

Earlier, based on an assumption (perhaps fed by foreign contractor or local vested interest) that IPS Cardwell rig was unable to drill, Petrobangla secured the services of a rented rig and crew from abroad during the late 1990s and early 2000. Huge foreign exchange was drained out on rental alone, while the IPS Cardwell rig was perhaps sitting idle. Meanwhile, Bapex and BGFCL had jointly repaired and rehabilitated the IPS Cardwell rig. Some Taka 10 (ten) crore in foreign exchange was spent. This equipment is now capable of drilling five wells without any major expenditure on the rig. While, for mobilisation and demobilisation alone (for a hired rig from abroad) it would cost between 6 and 8 crore Taka in foreign exchange. Nobody apparently knows where is the catch! Manpower can be hired from Bapex. In fact, the job can be contracted out to the national specialised organisation -- Bapex.

Just for information, the rental cost of a similar rig would be around US$ 15,000 to 18,000 per day excluding the "mob and demob" cost. It takes about 70 to 90 days for drilling and testing an appraisal-cum-development well noted in the tender document. Thus, about US$1.5 million would be needed for each well on rental alone. The total drilling cost including rental, various services and materials could exceed US$6 million. If there is any accountability in the government, tender should be reviewed and a judicious decision taken.

Any sensible person would nearly get a cardiac arrest when he would find that the government opposes the development of Bapex. Therefore, it is time for us to insist on a thorough health check up of the Ministry of Energy and Petrobangla. Apparently, they have no mysterious, incurable disease. Primarily, they are suffering from mental malnutrition. The usual allegation is that in their unrestrained exuberance and pursuit of many goals, they have virtually created an energy famine over the past three years. They now have reached the point where they must do what a wise man calls "the hardest task in the world -- think" -- in order to continue pioneering and reversing famine into sufficiency once more, however without wasting scarce foreign exchange. The authorities in the energy domain in Bangladesh are so naive that they don't even realise what is printed in their nametag!

This reminds me of a story. The famous creator of Sherlock Holmes, Sir Arthur Conan Doyle, once hailed a taxi in Paris, threw his suitcase and got in after it. Before he could say a word, the driver asked, "Where to, Mr. Conan Doyle?" The surprised author said, "You recognised me?" "No" the driver replied, "I have never seen you or your picture." "Then how do you know that I am Conan Doyle?" "Well," the driver said, "I read in the paper that you are vacationing in the South, I notice you arrived on a train from Marseilles; you have a tan that come from spending a week or more in the sun; from the ink spot on your middle finger I deduce you are a writer; you have a keen look of a medical man; and the cut of your cloth is English. Putting all these together, I felt surely you must be Sir Arthur Conan Doyle, the author of great Sherlock Holmes". Conan Doyle was amazed: "From the way you recognised me from all these small observations, you yourself are the equal to Sherlock Holmes". "There is one more thing," said the driver. "What's that?" Conan Doyle asked. "Your name is printed on your suitcase."

Related to our energy problems, as a nation we had to have the situation boldly spelled out for us before we believed what various clues told us was inevitable. Now in retrospect, we see clearly what we might have deduced sooner. We must see the name inscribed on our suitcase soon enough -- hopefully soon enough -- to think and plan and act to avoid more serious consequences. Our greatest danger is complacency. Once the headlines and the gas lines disappeared, there will be a growing tendency to believe that we do not have an energy problem -- that the name on the suitcase is somebody else's.

Nuruddin Mahmud Kamal is a retired government official.