Data Collection Survey on Bangladesh Natural Gas Sector FINAL REPORT
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Ministry of Power, Energy and Mineral Resources The People’s Republic of Bangladesh Data Collection Survey on Bangladesh Natural Gas Sector FINAL REPORT January 2012 JAPAN INTERNATIONAL COOPERATION AGENCY ORIENTAL CONSULTANTS CO., LTD. SAD JR 12-005 Ministry of Power, Energy and Mineral Resources The People’s Republic of Bangladesh Data Collection Survey on Bangladesh Natural Gas Sector FINAL REPORT January 2012 JAPAN INTERNATIONAL COOPERATION AGENCY ORIENTAL CONSULTANTS CO., LTD. Source: Petrobangla Annual Report 2010 Abbreviations ADB Asian Development Bank BAPEX Bangladesh Petroleum Exploration & Production Company Limited BCF Billion Cubic Feet BCMCL Barapukuria Coal Mine Company Limited BEPZA Bangladesh Export Processing Zones Authority BERC Bangladesh Energy Regulatory Commission BEZA Bangladesh Economic Zone Authority BGFCL Bangladesh Gas Fields Company Limited BGSL Bakhrabad Gas Systems Limited BOI Board of Investment BPC Bangladesh Petroleum Corporation BPDB Bangladesh Power Development Board CNG Compressed Natural Gas DWMB Deficit Wellhead Margin for BAPEX ELBL Eastern Lubricants Blenders Limited EMRD Energy and Mineral Resources Division ERD Economic Related Division ERL Eastern Refinery Limited GDP Gross Domestic Product GEDBPC General Economic Division, Bangladesh Planning Commission GIZ Gesellschaft für Internationale Zusammenarbeit GOB Government of Bangladesh GTCL Gas Transmission Company Limited GTZ Deutsche Gesellschaft fur Technische Zusammenarbeit GSMP Gas Sector Master Plan GSRR Gas Sector Reform Roadmap HCU Hydrocarbon Unit IDB Islamic Development Bank IFC International Finance Corporation IOC International Oil Company JDCF Japan Debt Cancellation Fund JICA Japan International Cooperation Agency JGTDSL Jalalabad Gas Transmission and Distribution System Limited JOCL Jamuna Oil Company Limited KAFCO Karnaphuli Fertilizer Company Limited KfW Kreditanstalt für Wiederaufbau KGDCL Karnaphuli Gas Distribution Company Limited LNG Liquefied Natural Gas LPGL LP Gas Limited MGMCL Maddhapara Granite Mining Company Limited MMCFD Million Cubic Feet per Day MOF Ministry of Finance MoPEMR Ministry of Power, Energy and Mineral Resources MPL Meghna Petroleum Limited NEP National Energy Policy NSAPR II National Strategy for Accelerated Poverty Reduction II (Revised) FY2009-11 NWPGCL North-West Power Generation Company Limited PD Power Division PDF Price Deficit Fund PGCL Pashchimanchal Gas Company Limited POCL Padma Oil Company Limited PRSP Poverty Reduction Strategy Paper PSC Production Sharing Contract PSMP Power Sector Master Plan RPGCL Rupantarita Prakritik Gas Company Limited SAOCL Standard Asiatic Oil Company Limited SGCL Sundarban Gas Company Limited SGFL Sylhet Gas Fields Limited SOGC State-Owned Gas Company TGTDCL Titas Gas Transmission and Distribution Company Limited TFC Total Final Consumption of energy TPES Total Primary Energy Supply USAID United States Agency for International Development USGS United States Geological Survey WB World Bank Contents Survey Area Map Abbreviations Chapter 1 Outline of the Survey........................................................................................................1 1.1 Background of the Survey.....................................................................................................1 1.2 Objective and Contents of the Survey...................................................................................2 1.3 Survey Team .........................................................................................................................2 1.4 Survey Schedule....................................................................................................................2 1.4.1 Entire Schedule .............................................................................................................2 1.4.2 1st & 2nd Surveys in Bangladesh ...................................................................................3 Chapter 2 Summary...........................................................................................................................6 2.1 Present State and Challenges of Natural Gas Sector.............................................................6 2.1.1 Energy Consumption in Bangladesh.............................................................................6 2.1.2 Policies..........................................................................................................................7 2.1.3 Organization..................................................................................................................8 2.1.4 Natural Gas Demand.....................................................................................................9 2.1.5 Natural Gas Reserves, Exploration and Production....................................................10 2.1.6 Natural Gas Transmission ...........................................................................................13 2.1.7 Natural Gas Sales........................................................................................................15 2.1.8 Natural Gas Tariffs and Governmental Subsidies .......................................................16 2.1.9 Financial Condition of Natural Gas Sector Enterprises ..............................................17 2.1.10 Participation of Private Sector in Natural Gas Sector.................................................18 2.2 Assistance by Other Development Partners in Natural Gas Sector..............................................18 2.3 Proposal for the Assistance to Natural Gas Sector by Japanese ODA........................................19 2.3.1 Challenges of Natural Gas Sector Identified...............................................................19 2.3.2 Measures to Overcome the Challenges of Natural Gas Sector ...................................20 2.3.3 Priority of the Challenges to be assisted by Japanese ODA........................................22 2.3.4 Proposal for the ODA Loans.......................................................................................22 2.3.5 Proposal for the Technical Cooperation Projects ........................................................23 Chapter 3 Results of the Survey ......................................................................................................24 3.1 Present State and Challenges of Natural Gas Sector...........................................................24 3.1.1 Energy Consumption in Bangladesh...........................................................................24 3.1.1.1 Primary Energy and Commercial Energy Supply ...................................................24 3.1.1.2 Power Generation Energy .......................................................................................26 3.1.1.3 Comparison with Neighboring Countries ...............................................................29 3.1.1.4 Position of Natural Gas Sector................................................................................29 3.1.2 Policies........................................................................................................................30 3.1.2.1 National Development Plans...................................................................................30 3.1.2.2 National Energy Policy ...........................................................................................33 3.1.2.3 Policies for Natural Gas Sector...............................................................................33 3.1.3 Organization................................................................................................................35 3.1.3.1 Organizational Structure of Energy Sector..............................................................35 3.1.3.2 Organizational Structure of Natural Gas Sector......................................................37 3.1.4 Natural Gas Demand...................................................................................................43 3.1.4.1 Sectorial Gas Demand.............................................................................................43 3.1.4.2 Seasonal Fluctuation of Gas Demand .....................................................................54 3.1.4.3 Introduction of Alternative Energy .........................................................................55 3.1.4.4 Demand Side Energy Saving ..................................................................................56 3.1.5 Natural Gas Exploration and Production ....................................................................57 3.1.5.1 Gas Resources.........................................................................................................58 3.1.5.2 Present State of Natural Gas Production.................................................................68 3.1.5.3 Projections for Natural Gas Production ..................................................................69 3.1.5.4 Import of Natural Gas .............................................................................................71 3.1.6 Natural Gas Transmission ...........................................................................................74 3.1.6.1 Present Status of Existing Gas Grid ........................................................................75 3.1.6.2 Upcoming Pipelines ................................................................................................77 3.1.6.3 Gas Pipeline Network Analysis...............................................................................79