Chevron Bangladesh has halted its development projects due to outstanding payments exceeding $160 million, sparking concerns about a potential drop in the country’s gas output.
The multinational company supplies nearly 60% of Bangladesh’s natural gas, but unpaid dues have stalled key projects, including the installation of a compressor at the Jalalabad gas field.
Had the project proceeded as planned, it was expected to boost daily production by approximately 70 million cubic feet.
Chevron’s pending bills amount to the equivalent of four months' worth of gas supply.
Despite an agreement in October to clear dues in installments of $20 million per month alongside the running bills, only the November payment was disbursed.
Since then, arrears have continued to accumulate, reaching $160 million in March.
In a letter dated 9 January, Chevron urged the Bangladeshi authorities to clear at least $75 million immediately to prevent disruptions.
Signed by Chevron Managing Director and President Eric M Walker, the letter requested intervention from the energy secretary, yet the situation remains largely unchanged.
When asked about the outstanding payments, Sheikh Zahidur Rahman, manager of media and communications at Chevron Bangladesh, declined to comment due to company policy.
However, he confirmed that a planned project to enhance gas production at the Jalalabad plant has been suspended until the dues are settled.
Chevron, which operates in Blocks 12, 13, and 14, remains Bangladesh’s largest gas producer, supplying 60% of the country’s domestic gas and 83% of its condensate.
The Bibiyana gas field, its largest site, supplied 954.1 million cubic feet on March 17, a significant drop from its peak production of over 1,300 million cubic feet due to depleting reserves.
Overall, domestic gas production has declined from 2,800 million cubic feet per day to 1,883 million cubic feet as of 17 March, despite a national demand of 5,500 million cubic feet.
To bridge the gap, Bangladesh began importing LNG in 2018, but at a steep cost—while Chevron supplies gas at $2.76 per unit, LNG imports cost around $10.50 per unit.
Chevron is not the only creditor pressing for payment. Qatar, which supplies 40 LNG cargoes annually under a government-to-government deal, has also urged Bangladesh to clear its dues.
Meanwhile, Petrobangla itself is owed over Tk280 billion, including Tk180 billion from the power sector.
The financial crunch has led LNG suppliers in the spot market to lose interest, often leaving Bangladesh struggling to secure shipments despite multiple tenders.
