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reuters
info@reuters.com

6/08/04 7:25 PM
Canadian firm Niko finds gas in Bangladesh

DHAKA, May 6 (Reuters) - Canadian oil company Niko Resources Ltd has discovered gas in an abandoned field in Bangladesh and aims to produce up to 15 million cubic feet (mcf), a senior energy official said on Thursday.
Commercial production is due to start from mid-June, he said.

"Niko Resources has discovered a significant amount of gas in the Feni gas field in block 15 on Wednesday afternoon," M.A. Based, managing director of Bangladesh Petroleum Exploration and Production Company Limited (BAPEX), told Reuters.

BAPEX, a sister firm of state-run Bangladesh Mineral, Oil and Gas Corporation (Petrobangla), signed an agreement last October to explore for gas jointly with Niko Resources in the field located in eastern Bangladesh.

"This is a joint venture between Niko and BAPEX with a 50:50 ratio to exploit gas in the field," Based said.

Niko has invested $15 million in the project.

"We expect to produce between 10 million cubic feet (mcf) and 15 mcf per day from this field and hope to begin commercial production from the middle of next month," the BAPEX chief said.

Bangladesh Gas Fields Company Limited, another sister organisation of Petrobangla, discovered Feni gas field in 1981 but abandoned it in 1998 after producing a total of 40 billion cubic feet of gas.

"The field was abandoned when its well-2 turned dry," Based said.

An expert with Petrobangla said the reserves in the field might be about one trillion cubic feet.

BAPEX had said it would also explore another gas field at Chhatak, in the northeast, under the joint venture with Niko. Reserve estimates for Chhatak is unavailable, but Based had said it was a medium-prospect field.

The country has 20.5 trillion cubic feet of proven and recoverable gas reserve based on current estimates, officials said.

Dhaka is under pressure from international oil firms and donors to sell gas to neighbouring India to raise funds for national development, but the government had said it would not export until reserves could meet 50 years of local demand.
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