Chevron resumes output from damaged well in Bangladesh's Bibiyana gas field

Chevron Bangladesh has partially resumed natural gas supplies from a damaged well in the Bibiyana gas field, ramping up the South Asian country's overall natural gas output as it grapples with an acute power shortage.

The damaged onshore gas well in Bibiyana, located in Bangladesh's gas-rich north-eastern region, is currently producing about 30,000 Mcf/d of natural gas, less than half of its 70,000 Mcf/d capacity, a senior Petrobangla official told S&P Global Commodity Insights April 28.

With the resumption of natural gas production from the well, Bibiyana's total output was about 1.23 Bcf/d as of April 27, according to the official.

The well was damaged when sand started flowing with natural gas due to production anomalies, forcing Chevron Bangladesh to shut the well along with five other onshore gas wells in the Bibiyana gas field on April 3.

Natural gas output from Chevron-operated Bibiyana gas field had dropped by about one-third to about 800,000 Mcf/d because of the shutdown, from about 1.275 Bcf/d earlier, according to Petrobangla data.

Chevron had changed tubes in the six producing gas wells prior to the shutdown to increase gas output, a senior energy ministry official said.

Tube change raised Bibiyana's natural gas supply into the national grid to about 1.275 Bcf/d, from about 1.145 Bcf/d, previously.

Chevron Bangladesh, with its output from three onshore fields -- Bibiyana, Jalalabad and Moulavi Bazar -- is the largest producer of natural gas in country. The fields are in blocks 12, 13, and 14, respectively.

LNG demand soars

Bangladesh's overall natural gas supply hovers around 3.10 Bcf/d, with regasified LNG at about 800,000 Mcf/d and the rest of the output from domestic gas fields, including Bibiyana, according to Petrobangla.

The abrupt fall in gas supply from Bangladesh's largest producing Bibiyana gas field had triggered a countrywide natural gas crisis that affected industries, power plants and household consumers.

Bibiyana dominates Bangladesh's gas supply with a total of 26 producing wells in the fossil-fuel hub and accounts for over half the total output from domestic gas fields.

Although the five gas wells in the Bibiyana gas field came online within four days on April 7, state-run Petrobangla impose a 10-day gas rationing over April 12-April 21 for local industries asking industrial consumers to not consume natural gas for four hours daily to tide over severe energy shortage.

A six-hour daily gas rationing for CNG filling stations from 5 pm to 11 pm local time is still in effect.

Petrobangla has increased LNG imports from the spot market to meet its needs, with the current price hovering around $35/MMBtu.

The country is also looking to extend its existing 15-year LNG agreement with Qatar as it struggles to secure more LNG imports to meet rising domestic requirements.

Oman Trading International, or OTI, also supplies LNG to Bangladesh under a long-term deal, apart from Qatargas.

While Bangladesh usually imports half a dozen LNG cargoes from these two long-term suppliers each month, it is also purchasing about three LNG cargoes from the spot market every month.

S&P Global expects spot prices will need to stay below the $25/MMBtu mark or potentially even lower to spur larger-scale spot purchases across Asia-Pacific, with most of the spot procurement currently coming from countries that have been forced to turn to LNG amid a declining resource base.