Business with Development: Chevron’s Corporate Social

Responsibility

Business with Development: Chevron’s Corporate Social Responsibility

Corporate Social Responsibility or CSR is the most talking terminology

in recent times among corporate world, commercial community and
capitalistic industry, and its practices are being integrated into national
and international business practices and hence it is becoming one of
the determining factors for market access. According to United Nations
Industrial Development Organization, CSR is generally understood as
being economic, environmental and social imperatives (Triple-Bottom-
Line-Approach), while at the same time address the expectation of
shareholders and stakeholders. The world business council for
sustainable development in its publication “MAKING GOOD BUSINESS
SENSE” by Lord Holme and Richard Watts defined CSR “is the
continuing commitment by business to behave ethically and contribute
to economic development while improving the quality of life of the
work force and their families as well as of the local community and
society at large.”

Traditionally in the USA, CSR has been regarded as humanitarian

model. Companies make profits, fulfilling their duty to pay taxes. Then
they donate a certain share of the profits to charitable causes. The
European model is much more structured and sophisticated, focusing
on function the core business in a socially responsible way. Economists
and CSR experts have emphasized on practicing the European Model
for sustaining development and better CSR programme.

The concept of CSR derived from ensuring improving corporate

governance , labor rights , work place safety, fair treatment of workers,
community development and environment management , but also for
industrialization and assurance for the global market access. Some
corporate houses and multinational companies are pioneering the
practice of CSR by performing various programmes for community
development, environment safety and ensuring good governance.

Chevron Bangladesh a large foreign IOC working in Bangladesh is

engaged in exploration and extraction of natural gas from different
blocks of Bangladesh and playing a vital role to stringent the energy
sufficiency of the country. Business with development is a primary
determination of Chevron Bangladesh, ensuring energy products to
sustainable development and community development are core
strategy of its business policy. Basically it’s basis is to built on
principles, which distinguishing from other corporate houses, CSR of
Chevron Bangladesh has been intermingled in strategic business policy
that weighing up good governance, labor rights , environment safety ,
participating local community in development activities and consumer
rights. CSR at Chevron Bangladesh is the application of the Chevron
Bangladesh way across environmental, social and governance. It
implements CSR priorities through existing management system,
process and policies as part of commitment to operate responsibly and
ethically.

Business within exploration and production

Chevron Bangladesh has wide-ranging oil and gas exploration and

production business network around the world. Its worldwide net oil-
equivalent averaged 2.7 million barrels per day in 2009 which is 7
percent higher than in 2008. The offshore regions of West Africa and
the U.S gulf México, the gulf of Thailand and offshore northwest
Australia were spotlights for exploration in 2009 .While Asia- pacific’s
leading capital holder and producer among international oil companies.
Chevron is putting in a portfolio of energy resources to congregate
emergent energy demand in the region. Similarly its operation is
applying in Africa and Latin America .In Europe; it has adaptable
operations and exploration interests in the western region of the
Shetland basin, the Norwegian Barents and Greenland.

Chevron Bangladesh has been performing a vital role in production and

exploration of gas and mitigating energy crisis Partnership and
cooperation with Petrobangla and GTCL.

Environment Safety and ecological balance

Chevron Bangladesh has been taking initiatives to protect environment

& biodiversity, thus the company engaged with International Union for
Conservation of Nature (IUCN) Bangladesh to form and lead a
biodiversity Monitoring team to guide and supervise Chevron
Bangladesh’s field activities. While Lawachara national park is situated
very close to Chevron Bangladesh’s Moulavi Bazar Gas Field which is
environmentally very sensitive, to protect its potential damage of
conservation of trees and lives, it has given utmost priority in
protecting the area, per the recommendations of the Environmental
Impact Assessment and the requirement of the environmental
clearance letter issued by the Department of Environment. The
monitoring team recorded a total of 55 wildlife species comprising 3
amphibians, 4 reptiles, 42 birds, and 7 mammal species, specially
recording 3,28,272 and 51 individuals respectively. However, at pre
and post biodiversity monitoring, a total of 185 species were traced out
comprising 10 species of amphibians, 17 reptiles, 148 birds and 12
species of mammalians. On the other hand, the post –project survey
recorded a total of 153 species of wild fauna comprising 9 species of
amphibians ,11 reptiles, 122 birds and 11 species of mammalians.
Another significant achievement was that had been ensured living
existences ,such as Hoolock Gibbon , Capped Langu , Pig-tailed
macaque, rhesus Macauqe, Orange –bellied Himalayan squirrel, Hoary
–bellied squirrel , Emerald Dove , Asian Barred Owlet ,etc.

Deforestation is another major problem for environmental insecurity

that has been directly devastating ecological and geological balance.
Chevron Bangladesh consequently, has been taking initiatives to tree
plantation program. From 2005 Chevron Bangladesh started tree
plantation program in Jalalabad plant. A total of nearly 120,000
saplings have peen planted surrounding areas of plant. In 2009, 3,000
saplings have been planted around the road leading from Chevron
Bangladesh Sylhet office to Jalalabad gas plant. Approximately, 5000
saplings at Moulavibazar gas field and 4,000 saplings at Bibiyana field
have been planted in 2009.

Steve Wilson, President of Chevron Bangladesh expressed pleasing

speeches on this successful story “Chevron operations around the
world peacefully co-exist with all varieties of ecosystem. If I took at the
recent 3D seismic survey which we conducted in Moulavibazaar a
portion of that was carried out in the Lawachara forest. By taking a
prudent approach, involving third parties to ensure that the
environment was protected we made sure that animals were not
disturbed”.

Community Development and Social Advancement Programme

Community and socio-economic development are core policy of

Chevron Bangladesh’s CSR program. Partnership and harmony with
local community blending a new ideology in contemporary CSR
practice, is at its core value and mission are mostly evaluated through
social advancement program. In this context CSR practice of Chevron
Bangladesh is typically basis on social improvement, community
development, economic emancipation and women empowerment.

• Chevron provides sponsorship to The Asian University for Women

Support Foundation of US$ 250,000. The continuation of the support
the company has rendered since 2004-2005, to the tune of
approximately $50,000 per year.
• Chevron Bangladesh continues to be a firm believer in the principle
of community-driven development and instilling a sense of ownership
and pride amongst beneficiaries – encouraging them to have a vested
interest in their own journey towards self-sufficiency. Around 4800
families are engaged with Chevron supported skill enhancing programs
in Bibiyana and Moulavi Bazar fields. Chevron Bangladesh and Hathay
Bunano signed a partnership to establish a training centre called
“Hathay Bunano Proshikhan Society” to help promote sustainable
employment for underprivileged women of Kamalganj, Moulavi Bazar.
The training centre will provide crochet and knitting training to 150
women who will each be capable of earning a supplemental income
within three months. Chevron is bearing 65% of the total project cost.

• With partnership of Friend in Village Development Bangladesh

(FIVDB), Chevron Bangladesh has been implementing Alternative
Livelihood Program for the neighboring community in Bibiyana and
Moulavibazar gas field, this program combines appropriate skill and
asset transfer, and adult learning approaches. ALP programs started in
2006 surrounding villages of Bibiyana plant with self-help group or
Village Development Organization formation approach. In addition of
Bibiyana, Chevron Bangladesh with the cooperation of its NGO partner
FIVDB operates a similar ALP project in 13 villages located in
Moulavibazar gas plant area . Besides, , collaboration with Save the
Children (USA), Chevron Bangladesh has supporting 13 non-formal
primary education schools at Bibiyana.

• Chevron Bangladesh has been running the scholarship program for

several years with a view to improving the overall educational scenario
of schools near its three gas fields. The number of Chevron supported
scholarships continues to increase significantly every year.In 2008, the
number of scholarship recipients stood at 551, while in 2009 it was
587, each being selected on the basis of their financial need and
academic performance. In addition to scholarship support, extra
teaching support and coaching support to the high school, Chevron is
also supporting 13 non-formal primary schools in Bibiyana. Chevron
supported scholarship program helps create awareness among families
and teachers to assist students in learning and thus motivating
students to do better in their exams.
• Since 2005 health care servicing is being smoothly activated,
presently running 3 Chevron Bangladesh Smiling Sun Clinic and
approximately 32 Chevron supported satellite clinics and covering
approximately 84,000 people per year, especially woman, children and
elderly citizens. We provide primary health care support, including
clinical support, pathological test support, counseling support and
medicine.
Chevron has been carrying the maternity centre since 2004 in a range
of capacities including building a structure in 2004 to set up the centre
in Sylhet, donating $20,000 to produce blood bags and reagent for
screening. Chevron Bangladesh has also been collaborating with the
Red Crescent centre to organize blood donation drives for its
employees since 2004. In 2009, the number of blood bags donated by
its employees in Dhaka and all its field locations reached 493 and
Chevron was recognized as the third-highest blood donor by the Red
Crescent Society in 2009 among all corporate bodies. In 2010 a total of
249 bags of blood were collected from the drive.
There is a huge debate regarding practicing of CSR in Bangladesh
among the experts & researchers, most of them opined that the
company’s CSR is covering much more than just giving to charity.
Nevertheless, CSR is approaching a strategic business core and
tremendously becoming a development factors for the social
advancement and national building. We can sight an example in the
case of TATA in India who has believed in national building as an
overarching objective of their aims in business. The mission to
sensitize businesses in Bangladesh to the need for CSR, when
conditions for doing business are fraught with enough difficulties
already, is not proving an easy one. But with dedicated corporate
houses like chevron Bangladesh determinedly marching on regardless,
we too may one day see a titan in our corporate sector attain the
stature and influence of true practice of CSR

CSR practice in Bangladesh: Harmony between business and

society

Tithe Farhana

Corporate Social Responsibility or CSR is a familiar terminology in

recent times and its practices are being integrated into international
business arena and hence are becoming one of the determining factors
for market access. According to United Nations Industrial Development
Organization, CSR is generally understood as being economic,
environmental and social imperatives (Triple-Bottom-Line-Approach),
while at the same time it addresses the expectation of shareholders
and stakeholders.

The concept and practice of CSR are comparatively new for the
corporate sector of Bangladesh. However, its existence was felt long
back by export earning sectors, especially RMG sector. During the
period of 1990s cheaper Bangladeshi garments, produced by
underprivileged women and children, attracted foreign buyers towards
the products as well as the working condition in the factory premises.
The buyers from North America and western Europe had put pressure
on RMG sector for ensuring and maintaining quality, and working
environment through stressing on good governance and banning of
child labour.

In Bangladesh, question might arise whether the corporate sector is

practicing CSR or doing just a charitable work and pursuing
philanthropic activities. So, if philanthropy is something different from
CSR, then how can we define it and more significantly describe its
implementation and implication in Bangladesh?

Dr. Mohammed Farashuddin, ex-governor of Bangladesh Bank

explains: "CSR intertwines strong commitment and responsibility to the
people who are part of Organisation, the group of people within which
you control and it comprises a number of key features and have to be
responsive of the operational conditions and labour standards, the
environment within which your employees are working and how they
are being treated upholding the dignity of human life. That is very
important in terms of gaining a proper understanding of CSR". He said
it is not any good enough to donate and perform charity works while
polluting the environment or leaving the workers in inhuman condition.

Mohiuddin Babor, head of Media & Communications of Robi, said CSR

as corporate economic responsibility has multidimensional impacts.
"The economic impacts can be beneficial collectively for stakeholders,
government, customers, subscribers, suppliers and the communal
growth in which the companies and corporate houses are conducting
business and it is mostly significant for those who are the market
leaders," he said.

Dr. Mohammed Farashuddin said paying taxes another economic

responsibility of the companies. He said: "Paying taxes regularly can
be good practice of economic responsibility and that contributes to the
development of the country."

Bitopi Das Choudhury, Head of Corporate Affairs, Standard Chartered

Bank notes on the companies CSR activities "as the way to perform
responsibility on the health, stability, and prosperity of the
communities in which they operate and it is also sole responsibility
while the companies are regarded as corporate citizens. She further
discussed the CSR activities of SCB highlighting the development of
youth, sports and health. According to her, SCB corporate activities are
mostly concentrated at grass roots level aiming at building talents and
skills in rural areas. She also adds: "It is committed to practice global
standard of CSR.

Sami Hafiz, Corporate Sustainability & Sponsorships Manager of The

Hong Kong and Shanghai Banking Corporation Limited said: "CSR
policy of HSBC Bangladesh is based on the HSBC Group's policy as we
are part of the Group. Our belief is that Corporate Social Responsibility
(CSR) should be something ingrained in the corporate culture and be
sustainable. That is why we name our CSR programs as Corporate
Sustainability. The Bangladeshi programs focus on two major factors -
education, especially education for underprivileged children and
environment".

Debashis Roy, Deputy General Manager CSR, Grameenphone explains

"Consumer rights and responsibility to working force are important in
CSR practice, Responsibilities to employees and consumers are
foremost concerns in GPs' corporate accountability. Discrimination at
work place is very common phenomena, nevertheless the companies
have to pursue CSR in an ethical manner and keep away from
favouritism, injustice and discrimination". He also adds: "responsibility
to employees in GP includes taking care of the employees' welfare and
safety at work and upholding their skills, competences and
proficiencies with motivation for work, equal responsibility to
customers.

Independent observers say, now-a-days CSR activities are too much

focused by Media. And companies are more interested in focusing on
their products rather than performing social responsibilities. But Sami
Hafiz refused to accept the notion saying: "We do not view it this way
as CSR is ingrained in our culture and is part and parcel of what we do.
Our Group Chairman, Stephen Green has said that "Our goal is to be
the leading brand in sustainability". Debashis Roy also echoed the
sentiment explaining "GP aims to ensure meaningful social investment
through effective projects into development issues of this country,
primarily education, poverty alleviation, health and empowerment."

Sami Hafiz praised efforts of the Bangladesh Bank and the government
in strengthening CSR and said: "The present government has already
taken initiatives to encourage other organisations to come forward as
it offered a 10% income tax rebate on the CSR funds, made allocation
of US$100 million to combat climate change and took many other
steps. In the financial sector, the Bangladesh Bank as regulator is
monitoring all banks' CSR initiatives as well as encouraging others to
take a more active role in supporting their communities".
Grameenphone CSR Programmes: 1. Grameenphone has added to its
network more than 25 million people across the country as well as
provided direct employment opportunity for more than 4500 people.
About 150, 000 people are directly or indirectly engaged in the
business network that has empowered economically to those people. It
has invested Tk 149.5 billion in Bangladesh for infrastructure
development. Corporate Economic responsibility is perfectly
undertaken by paying taxes. 2. Partnership with Pathfinder
International and USAIDS's network of Smiling Sun Clinics in 61
districts, GP is operating Safe Motherhood and Infant Care project. A
total of 1,440,836 economically disadvantaged mothers and infants
received free healthcare services. GP jointly with Sightsavers
International organised the eye camp where around 36327 patients
received free-eye care support and 4745 cataract surgeries being
performed. 3. Grameen phone is partner of the mass awareness
campaign during the national immunisation days with Bangladesh
government, UNICEF and WHO. 4. Every information counts-
Information Boat project works as information hub to meet the
communication needs of rural communities, especially in the Char and
Haor areas. At present, 4 information Boats are serving the haor areas
of Sunamgonj and Kishorgonj. 5. Every confidence counts -
rehabilitation of Acid Victims project formed in 2007 with the support
of the Acid Survivors foundation. Six acid victims are now working in
GP. 6. GP in partnership with Grameen Shikkha, an organization of
Grameen bank family, provides financial aid to 100 underprivileged
students through a scholarship fund. 7. The Grameen Phone
Community Information Center (CIC) started functioning in 2006 with a
vision to link and provide information based service to underprivileged
rural people, SME entrepreneurs and create employment opportunities.
8. Cell Bazar was launched in 2006 to facilitate local traders and rural
entrepreneurs with essential market information and contribute to
business expansion. Over a million subscribers have accessed its
service since its introduction 9. Grameenphone Ltd. adheres with
Campaign for Popular Education (CAMPE) to promote 1GOAL. It has
seized this responsibility to generate consciousness as its social
responsible responsibility. 1GOAL is a global initiative backed by over
100 organisations in over 100 countries and they will put pressure on
governments around the world to deliver the extra US$16 billion a year
that is needed to pay for every child to attend school. In Bangladesh ,
Grameenphone has sent SMS to approximately 25 million GP
subscribers worked with CAMPE to enlist support from the local
celebrities from different sectors. 10. Grameenphone Ltd., in
partnership with daily newspaper Prothom Alo, has organized an event
titled "Duniya Kapano Tirish Minute" to commemorate the 21 February
spirit. Last year GP in association with prothom-alo published a book to
preserve the letters written by and to freedom fighters to capture the
personal stories during that time.

Standard Chartered Bangladesh CSR Programmes: 1. Seeing is

Believing - A New Vision aims to raise USD 20 million to develop
comprehensive, sustainable eye care for 20 million people in less
advantaged areas of 20 cities across the world, including Dhaka. 1.
Standard Chartered-Financial Express jointly presents Corporate Social
Responsibility Award for build awareness in CSR practice amongst
business organizations. 2. Standard Chartered Young Tigers U -16
National Cricket Tournament has become the platform for hunting
young cricketing talents from all over Bangladesh. 3. Standard
Chartered Bangladesh is also the sponsor of Young Learners Club of
The British Council for the last 11 years. 4. Standard Chartered has
been providing financial support for the education programme of
"National Fellowship for the Advancement of the Visually Handicapped
(NFAVH)" to facilitate necessary educational materials for the visually
impaired for last six years. 5. 'Dhaka alias Jahangirnagar: 400 years', a
book written and compiled by Professor Dr. Enamul Haque and
sponsored by Standard Chartered Bank. It is the first book of its kind
that aims to capture 400 years of history.

Robi CSR Programmes: 1. Robi takes up programme on the occasion of

the World Health Day. Under the banner "Shusto Nari, Shusto Paribar",
organized a health camp for the under privileged women in Rangpur.
2. Robi lit up ten remote villages across the country with social power.
The villages are Tamaruddi, Bachamara, Pachuria, Protapnagar,
Charjanajat, Motherbunia, Chaitar Khamar, Char Neuton , Padma and
Pirganj in the different districts of Bangladesh from north to south and
east to west. Robi is initiating a project to reach 500 homes in 50 hard
to reach villages all over the country. This will help power starved
villagers with light at night and enable them perform personal, social &
economic activities. These villages will be known as Robi Palli. 3. Robi
celebrates 100th International Women's Day with the underprivileged
women of the society who are deprived of the basic health facilities.
With the pledge 'Healthy Women, Healthy Family', Robi commences its
Free Health Camp initiative under its corporate social responsibility
programme. 4. Robi & The Daily Star have mutually commenced
English in Schools ( EIS), a language learning program to promote
English language learning at secondary schools across the country.

HSBC CSR Programmes: 1. To promote business ideology and

strengthen leadership quality in the young generation, HSBC in
Bangladesh commenced HSBC Young Entrepreneurs Awards in
2006.This programme is running successfully and celebrating its 4th
year. 2. HSBC-Prothom Alo Language Competition celebrated it's 5th
year in 2009. 3. HSBC Bangladesh has taken up a Tk 10 million
initiative to provide support to the people affected by hurricane (AILA).
4. HSBC has been rated number 1 in the financial sector and third
overall in the 2009 for carbon Disclosure project. 5. HSBC Daily Star
Climate Awards is organized jointly The Daily Star and HSBC. 6.HSBC
has been providing support to various organizations including School of
Hope, SEID Trust, Scholar's Special School, BERDO and many others
organisation.

Anatomy of The Gas Crisis

Tithe Farhana

Bangladesh is floating on gas -- a much-vaunted notion propagated by

the Unocal and other foreign oil companies as well as academicians of
BUET and professionals seven years ago. Paradoxically, the notion has
become abstract as gas crisis looms large in the country affecting the
domestic, industries and agriculture sector users. As a result, the
Petrobangla became vocal against such pseudo statement and a
national committee on gas utilization stated in 2002 of 'a bleak future
of gas crisis' for Bangladesh from 2012.

Gas was first discovered in Chhatak that was later used in the Chhatak
cement factory in 1960 as its first commercial usage. It was then used
for the first ammonia grassroots complex, NGFF at Fenchuganj in 1961.
However, natural gas was discovered in 1955 at Haripur (Sylhet gas
field). According to M.Tamim, a BUET professor, gas was not
considered a valuable item at that time as use of oil was at the height.
It was treated as a by-product of oil production and was considered
more as a nuisance than of any value. As a result, the best commercial
use at that time was its household use.

The decade of 1960 was the landmark in the history of gas discovery.
Shell Pakistan was pioneer on gas exploration of this region that
discovered five major gas fields including Titas and Habiganj. In the
post-independence period, Shell handed over these fields to
Bangladesh for only four million pounds sterling. Gradually the
commercial and domestic consumption of gas increased rapidly
instead of oil and most power plants, mills, factories and other
industries were utilizing it. The exploration by international oil
companies (IOCs) under production sharing contract was prepared
dividing the country into 23 blocks. During the period of 1974-77,
seven offshore wells were drilled with only one gas field discovery.
Under the new PSC in 1988, four blocks were awarded to two IOCs who
drilled four wells leading to the discovery of one gas field.

In the early 1990s the model PSC of 1988 was modified and 8 blocks
were awarded to four IOCs. During the 1990, drilling did not get
momentum in spite of the presence of the IOCs. BAPEX, the
exploration company of Petrobangla did not go for any exploration
since 1997. IOCs have also slowed down their work. The production of
gas has been increasing sharply over the last decade. While only 2.3
bcm of gas was produced in 1983−84, production grew to about 7.5
bcm (265 bcf) during1995−96. Gas production reached 9.4bcm (332
bcf) during 1999−2000 and 14bcm (500 bcf) in 2005.

The supply and demand gap of gas started widening in 1998 when
Unocal discovered Bibiyana gas field. At that period, Bangladesh could
not exploit gas because of low market demand. As a result, the IOCs
stopped exploration of gas except a minimum work that was obligatory
for the contract to seize the most prospective acreage. According to
PSC, if a saleable discovery is made, Petrobangla will have the first
right of purchase and if they cannot purchase the gas, the IOCs can
sell it to any local third-party as the second alternative. In 2002, a gas
utilization committee suggested that IOC should be allowed to export
their share of gas from new discovery. Separated from unrestrained
and unplanned expansion of gas use, no other decision was taken in
the ten years since 1998 to find new gas. The result is the leanest
decade of gas discovery of Bangladesh.

Experts identified four major reasons for contemporary gas crisis:

choking bureaucracy, corruption, unequal deals and mismanagement.
They also put across the crisis over dependence on IOCs and
negligence on modernization and capacity building of the companies
under Petrobangla and lack of coordination between Petrobangla and
Energy Ministry. According to a report, the government's 'fast-track'
gas exploration involving foreign companies in state-owned onshore
gas fields is caught by bureaucratic mismanagement. State-owned
Petrobangla sought EoI (expression of interest) from reputed firms in
September 2009 that opened up the opportunity for the first time
allowing the firms to explore country's state-owned gas fields. Now,
lack of inter-agency cooperation between the Energy Ministry and
Petrobangla is delaying the projects.

Mohammad Zamir, Former Secretary and Ambassador, expressed a

pessimistic view about 'negligence of past governments' on
development of the sector. He pointed out the problems of energy
sector as: confusion on statistics of proven gas and recoverable gas,
system loss and corruption, lack of patronization, problem of traffic
system and low price of utility elements. Moreover, political stability
has complicated the situation. That is why the foreign investors are
less interested to invest. The question is emergence on financing and
patronization of energy sector as exploration and operation of power
plants are opting for huge amount money. The financing of energy
sector requires huge amount of cash flow. A 1,000MW coal-fired power
plant needs a billion dollar, a 1,500MW nuclear power plant requires
US$ 4 to 6 billion, and a tcf of new gas will require a billion dollars for
exploration and development. According to a report, the gas demand
in 2012-13 will rise between 2,500 million cubic feet per day and 2,873
million cubic feet per day. In 2014-15, the demand will be between
2,669 million cubic feet per day and 3,087 million cubic feet per day.

Against this backdrop, Dr. Khalequzzaman stressed the need for

exploration on Offshore and Onshore through IOCs and public
companies. , although assumes PSC should not contact in the
contradicted attitude that might hold opposing views national welfare
and interest.
The energy ministry has started gas holiday to face the uncertainty.
But its plan faced opposition from the Bangladesh Ceramic Ware
Manufacturers Association (BCWMA). According to industry insiders
and stakeholders of ceramic industry, ceramic factories and other
manufacturing sector needs round the year gas supply for smooth
production and such rationing will compel to shut many units.
According to BCWMA, a total of 32 ceramic factories have been set up
with an estimated investment of Tk 2,500 crore. Bangladesh is
exporting ceramic products to Europe and American market.

In a recent statement, Bangladesh Knitwear Manufacturers and

Exporters Association, Garment Manufacturers and Exporters
Association and Textile Mills Association urged the government to
ensure gas supply to their industries on a priority basis. They said that
the garment industry zones in Dhaka, Narayanganj, Chittagong,
Ashulia and Savar are affected rigorously by the inconsistent gas
supply. Providing gas to labour-intensive export industries on a priority
basis is a realistic decision, according to experts. Industry experts said
gas scarcity has been hampering production in knitwear as they
depend on gas-fuelled equipments for washing and dying. Gas
shortage in dying and spinning units also turns captive power
generators idle.

Current gas shortage in the capital and adjoining districts is around

150-200mmcfd as Titas supplies around 1,450mmcfd of gas against
the demand for 1,600mmcfd. According to a report, total gas shortage
in the country is around 3000mmcfd as Petrobangla supplies around
1,980mmcfd against the demand for 2,000mmcfd. The demand in the
country is projected to reach a level of an average 2200 mmcfd in the
2009-2010. According to the Petrobangla, statistics of December 2009
show 91.55 MMCM gas was used in 500 CNG filling stations on an
average while the total number of CNG-driven vehicles was estimated
at 177,555. Sources in the Petrobangla said that they had been
continuously making efforts in locating new gas reserves to meet the
growing energy demand. Leaders of the CNG filling stations claimed
business will be seriously hampered if this situation continues.

Chittagong region will face disastrous situation when the Sangu gas
field will close in 2012. Gas production from Sangu had slumped as low
as around 35 mmcfd production from its average production from of
180 mmcfd during 2006, gravely affecting the supply situation across
Chittagong. Nevertheless the present production level can be
continued. The Sangu field in the Bay of Bengal has produced 450
billion cubic feet extra since it started production in 1998. Sangu was
one of the largest discoveries in the 1990s while Cairn was one of the
first international companies that started operating in Bangladesh.
Apart from Cairn, the joint partners in the Sangu field are Australian
Santos and US-based HBR Energy. While the field started production in
1998, Petrobanla allowed Cairn to maximize production as the country
at that time was facing gas shortage. If petrobangla was careful, it
would not have allowed 160 mmcfd productions. It would have settled
for a conservative rate that would have given the field longer life,
experts opined. According to a report, Cairn has already informed the
government about the grim prospect of the offshore Sangu field
following a lackluster months-long drilling in 2007. Cairn had informed
the state-owned Petrobangla that the per day gas production from
Sangu gas field would decline by 20 mmcf every year. Sources said
Cairn Energy suffered a net loss of $82 million in fiscal 2006-07.

The present power crisis is closely linked to gas crisis while 85% power
generation is power-based. Recently the government has increased
power tariffs by 6-7 percent on an average. Trade and business bodies
already expressed their dissatisfaction over the latest hike of
electricity that would obviously hike the price of industrial as well as
essential products. But BERC (Bangladesh Energy Regulatory
Commission) Chairman Syed Yussuf Hossain said, “the new power
tariffs have been fixed at rates much below the expectations of the
state owned power entities”.

Now, South Korean Oil Company GS Caltex is going to explore gas in

Patuakhali that purchased 45% interest of oil and gas block 7 from US
oil giant Chevron. Chevron (previously Unocal and Occidental) has
been the most successful foreign oil company in Bangladesh that is
producing around 900 million cubic feet of gas from three gas fields
Moulvibazar, Jalalabad and Bibiyana (biggest discovery of Chevron). In
these fields, Chevron has advanced around $ 920 million, which has
already been recovered from gas sales. In 2006 Chevron conducted a
1,000 kilometer line seismic survey in Moulvibazar and found at least
three potential hydrocarbon zones. It embarked on further studies in
2008 for better understanding of the potentials.
The Titas gas company has started working on introducing prepaid
meters for all consumers to systematize on utility and wastage energy.
It has started inquiring industries using gas-fired old boilers and
furnace to restore them with more energy efficient boilers and
furnaces. Titas has made a technical committee that will consult the
cost advantages of introducing prepaid meters. The country’s biggest
gas distributor company has 14.58 lakh domestic consumers and 4443
industrial customers. Presently, domestic consumers daily use 150
million cubic feet (mmcfd) gas. The prepaid meters might not prevent
domestic consummation from wasting gas as the price of gas is yet
low, but it might have significant outcome with commercial and
industry users, thinks authority of Titas.

That is why Bangladesh Development Forum -2010 paid attention

mostly on country’s power and energy sector. Chris Austin, Country
Director of Uk Department for International Development (DFID) and
co-chair of Local Consultative Group said that Bangladesh Energy
Regulatory Commission should be strengthened. He also said the
World Bank, Asian Development Bank, Islamic Development Bank and
Japan would invest in power and energy sector. The development
partners suggested the government conduct a detailed audit to detect
the huge wasted of power, energy and gas. Khurshid Alam, Secretary
of Bangladesh energy regulatory commission is also thinking similar.
He said “although the power of commission has been strengthen, the
action should more specific and empowered which are suggested by
Donors in Bangladesh Development Forum meeting”.

Md. Mosharraf Hossain, Former Chairman of Petrobangla & ex-acting

Chairman of Bangladesh Energy Regulatory Commission (BERC)
suggested utilizing the marginal gas fields which would have some
possibilities. The concept of utilization of marginal gas fields have
remarked as perfect instrument for satisfying consumers all over the
world. The concept of marginal gas was started in Bangladesh late
1990s, unfortunately it did not formulate. BAPEX is prepared to start
for the first time 3D dimensional survey in large national gas fields with
in a couple of months which will provide a new dimension. Like Bapex,
other seismic company should follow the benefits of existing and
marginalized gas fields. Indian experience can be mentioned here.
Indian government provided a number of financial incentives to
operate marginal oil and gas fields. Indian government has proposed a
pragmatic evaluation of the reserves in the marginal fields and
transparent evaluation criteria with simple contractual terms. As per
estimates, there are 165 marginal fields. Of this 39 have been
monetized in domestic and 25 have been monetized in industry and
commercial.

Mohammad Zamir considers that Private-public partnership (PPP) can

play a significant role for development in energy sector. Use of
renewable energy would have solved the ongoing crisis. PPP projects
and it’s implementation on energy and power sectors have been
discussed in Bangladesh Development Forum -2010 and development
partners have expressed their interest as well. Renowned economist
and president of Bangladesh Economic Association Dr. Khalequzzaman
said focus on implementation of PPP can accelerate economic and
infrastructural development. “PPP is new method of infrastructure
financing which has been emphasized by both government and the
donors; nevertheless this is not practiced which could be possible.
Consequently, it is very urgent to formulate policy and schemes for
significant out come of PPP in energy, power and other sectors that
would have reinforced awareness about its concepts and role among
different government departments, corporate sectors, non-government
organizations and above all the public”, he added.

Mohammad Zamir and Dr. Khalequzzaman suggested for the use of

renewable like solar power and biogas that might help solve the
problem substantially. Solar power is the most costly solution globally
but definitely a practical project. Dr. Khalequzzaman opined, “solar
power is perfect for Bangladesh for its availability rural areas”.
Presently over 300,000 household are using solar energy equivalent to
15 magewatts. Solar power have been used in the costal areas and
hilly regions which have solved energy crisis.

Coal is another important resource that remains unexploited.

Mohammad Zamir thinks the government needs to take proper steps
on coal and adapt a policy. But Dr. Khalequzzaman emphasizes on
implementation of comprehensive energy policy and development of
PetroBangla and BAPEX structurally and technologically.
Now strengthening and improving efficiency in both technological and
managerial sides of the government agencies for energy is one way.
Massive investment is also required for overcoming current critical
situation. In this situation, policy makers should emphasize on
mobilizing capital from internal sources. The private sectors are ready
to invest in the sector when a congenial investment framework will be
there. Moreover, the capital market is now vibrant and growing. So, the
government can also collect fund from share market. Finally, more
cautious decisions are a must for exploration and production of power
keeping uphold the national interest and safeguarding our future
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