The committee observed that the conditions in the framework of understanding (FoU) signed with Niko were against the interest of Bangladesh.

The matter of signing the agreement between Niko and Bapex (Bangladesh Petroleum Exploration and Production Company Limited) later became inevitable for the faulty FoU, according to the report submitted yesterday.

The enquiry committee was formed on August 16 to probe the deal with Canadian Niko Resources Limited for developing the "so-called" abandoned gas fields.

The committee submitted its report yesterday, two days behind schedule, to Energy Adviser Mahmudur Rahman.

The terms of reference for the committee were: 1) On what basis Feni, Kamta and Chhatak gas fields were declared abandoned; whether there was any flaw; 2) The framework of understanding (FoU) with Niko was signed after approval from which level and who signed-in, giving the approval, basis of approval; and 3) Whether finalisation of the joint venture agreement (JVA) was as per rules.

M Shah Alam, director general-2 at the Prime Minister's Office (PMO), led the committee while Bapex Managing Director M Jamaluddin was the member-secretary and Energy Ministry's joint Secretary (admin) Sheikh Abdur Rashid was the member.

The committee was asked to submit its report by August 31.

When his attention was drawn, Mahmudur Rahman told the news agency that the process of declaring the Feni, Kamta and Chhatak gas fields abandoned in 1999 was faulty. The policy framed in 2001 to justify the process was also obscure, he said.

Quoting the report, Rahman said, "There were two clauses in the FOU that later compelled the government to sign the JVA between Niko and Bapex."

A senior official, wishing not to be named, said a study was conducted in Chhatak and Feni under the FOU. But there was a condition that if the study found explorable gas, a JVA must be signed between Niko and Bapex. Former state minister for energy Prof Rafiqul Islam gave the final approval of this FOU."

Asked if the government is going to take action against the person responsible, Rahman said, "So far, three probe reports were received and we are waiting for another one. After getting that report, we will take opinion from the law experts and take steps."

The three non-producing gas fields were declared abandoned during the Awami League rule in late 2000 after the Canadian company came up with an "unsolicited" proposal for developing abandoned or marginal gas fields of Bangladesh on April 27, 1997.

The joint venture agreement between Niko and Bapex, a subsidiary of state-run oil, gas and mineral corporation, Petrobangla, was signed on October 16, 2003 under the BNP-led coalition government.

Before that a FoU was signed with Niko as Petrobangla on June 30, 1999 suggested such a study agreement for carrying out a study on the development and production of hydrocarbons from the non-producing marginal gas fields of Chhatak, Feni and Kamta.

Official sources said before signing the JVA, the production sharing contract (PSC) committee had asked for resolving two issues -- the area of Chhatak gas field to include only Chhatak west and include the provision of Swiss Challenge in the JVA.

The last development on the matter took place during the Awami League rule when the energy ministry on July 3, 2001 wrote to Petrobangla, asking to know about the status of negotiations on Chhatak, Feni and Kamta, and specific explanations on the issues, which had not been agreed upon.

Since then, the negotiations came to a halt, he said.

But, the officials said it revived after the BNP-led coalition government came to power and the Petrobangla chairman on January 21, 2002 wrote to the energy secretary outlining two unresolved issues --definition and area of Chhatak field, and share of BGFCL and SGFL in the project with Niko.

After negotiations, Bapex on October 16, 2003 signed the JVA under which Niko is now producing gas from Feni and met two accidents, first in January and second in June this year, while exploring gas in Tengratila.