Development activities are being hampered due to outstanding gas bills, with multinational company Chevron Bangladesh urging the government to settle at least $75 million immediately.
A letter signed by Chevron Bangladesh Managing Director and President Eric M Walker was submitted to the office of the secretary of the Energy and Mineral Resources Division last Thursday, according to ministry sources.
The letter appeals for the Secretary’s intervention in the settlement of the outstanding dues.
When asked about the overdue amount, Chevron Bangladesh Media and Communication Manager Sheikh Zahidur Rahman declined to comment, citing company policy on financial matters.
He also refrained from confirming whether the letter was sent.
Petrobangla Finance Director AKM Mizanur Rahman said that Chevron Bangladesh is likely owed approximately $150 million.
He added that the company’s monthly bill, based on the current supply of gas and condensate, amounts to around $40 million.
Discussions over Chevron's unpaid bills have persisted for some time.
Despite partial payments by Bangladesh, several months' worth of Chevron's gas supply remains unpaid.
In December, Frank Cassulo, Vice President of Chevron International Exploration and Production, visited Bangladesh and met with Chief Adviser Dr Muhammad Yunus.
The outstanding dues were reportedly discussed during this meeting.
Chevron, one of the world’s leading integrated energy companies, has operations in nearly every facet of the energy industry. In Bangladesh, it extracts gas from blocks 12, 13, and 14, producing approximately 60% of the country’s total natural gas and 83% of its domestic condensate.
The Bibiyana gas field is the largest, supplying 977.5 million cubic feet on 13 January, though production has declined from over 1,300 million cubic feet due to depleted reserves.
To manage the growing demand, Bangladesh started importing LNG in 2018.
However, prices soared following the Ukraine war, and the rising dollar value has exacerbated Petrobangla’s financial woes, despite several price hikes.
Proposals are underway to increase the gas price for new industries and captive users to Tk75.72 from Tk30 and Tk31.75, respectively.
Petrobangla sources revealed that the average cost of gas from domestic sources stands at around Tk6.07 per cubic metre.
Including 800 million cubic feet of imported gas, the average price for the 2022-23 fiscal year rose to Tk19.09, while the average sale price was Tk11.91, resulting in a loss of Tk0.98 per cubic metre.
The cumulative deficit over the past six fiscal years is nearly Tk280 billion.
Additionally, various entities owe Petrobangla substantial sums, with debts exceeding Tk280 billion from the power sector and others.
Meghna Group alone has unpaid gas bills amounting to Tk8 billion.
Alongside Chevron, the Qatari government has also pressed for the settlement of dues.
Qatar supplies 40 LNG cargoes annually under a government-to-government agreement, with current arrears estimated at $150 million.
