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BD seen striking

oil, gas deals during

Clinton visit

DHAKA: Bangladesh is set to strike at least two oil and gas exploration deals with several US companies during the upcoming visit by US President Bill Clinton, officials said.

"We have completed almost all formalities for signing final agreements with at least two petroleum companies from the United States," a senior official of Bangladesh's energy and mineral resources ministry told AFP.

"We can sign even one more deal if things go smoothly". He said the government had initialled three production sharing contracts (PSCs) with four US and one Irish companies for oil and gas exploration in two of the most lucrative blocks

Negotiations were going on with several other companies to enter into similar deals before Clinton arrives in Dhaka on March 20 for a one-day maiden visit, he added.

Energy negotiations, which resumed last month following confirmation of Clinton's visit, went on amid allegations by the main opposition Nationalist Party of "secrecy" in dealings with gas resources.

The opposition warns that any wrong decision concerning this promising sector would be suicidal and have opposed the leasing out of gas fields to foreign companies and the export of gas to neighbouring India, as is being pressed by the US and the World Bank.

Earlier negotiations, which began in 1997, stalled after a year of disagreements over provisions in the PSCs.

But energy officials said PSCs initialled this month made no mention of exporting gas to neighbouring countries, but the issue could feature prominently in the Dhaka-Washington talks during Clinton's stay.

Prime Minister Sheikh Hasina Wajed's government, however, said it could take a decision on gas exports only, after an assessment of the actual reserve.

Economist Debapriya Bhattacharya said: "For generating resources to meet urgent financing needs of the country, involving foreign companies in gas exploration is a sine-qua-non.

"But, Bangladesh lacks the required regulatory, institutional and legal framework to strike an effective deal".

On gas exports, he said it would be one option to tackle possible problems in a balance of payments that could arise from payment for gas to international companies in foreign currency.

Officially, Bangladesh had a proven recoverable gas reserve of 13 trillion cubic feet, of which three trillion has been extracted. But Shell, which is among the major companies operating in Bangladesh, says there is at least 15 trillion and "more to be found".ÑAFP