By Jack Detsch
The Diplomat
Activists of National Committee to protect Oil, Gas, Mineral Resources, Power and Ports set fire to papers during a strike in Dhaka. Image Credit: REUTERS/Andrew Biraj
Imagine you are a major energy magnate, poring over maps to find the world’s next natural gas superpower. Where would you invest?
Even though Bangladesh just hit an energy mother lode in July – winning the rights to 20,000 square kilometers of natural gas-rich waters from India in a U.N. territorial arbitration, chances are you probably wouldn’t think of it. To most, the territory still looks like a high-risk investment, given the political tenisions, pervasive poverty, and highly subsidized economy which undermines growth and limits spending on energy infrastructure. Dhaka and Chittagong, swathed in slums, are a world away from the air-conditioned shopping malls of Riyadh, Doha, and Dubai.
Yet, looking the part isn’t everything: Nigeria, Chad, and Venezuela have fared well in oil markets despite endemic poverty and violence; but Bangladesh’s troubles could help explain why investors haven’t been biting. In fact, quite the opposite; Australia’s Santos pulled the plug on Bangladesh’s only offshore gas field last year, citing poor production. With the help of KrisEnergy, a Singaporean company, Santos plans to begin drilling in shallow waters later this year. PetroBangla, the national oil company, attracted just two bidders in a 2012 auction for offshore drilling rights: India’s Oil & Natural Gas Corporation and Houston-based ConocoPhillips.
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