Tengratila Gas Blowouts
shahnaj Begum: Bangladesh claimed over US$1.05 billion as compensation from the Canadian company Niko Resources for burning the country’s gas reserves in Chattak Gas Field in Sunamganj on January 5 and June 24 in 2005 due to negligence.
Petrobangla has claimed the amount recently at a virtual hearing that was conduct to indentify ‘Head of Loss’ of Tengratila gas blowouts due to the damage caused to properties and gas reserves in and around the gas field.
The International Centre for Settlement of Investment Disputes (ICSID) has conducted the virtual hearing to indentify ‘Head of Loss’ of Tengratila gas blowouts against Canadian company Niko Resources for burning Bangladesh’s gas reserves due to negligence.
“We placed all of our arguments and submitted papers supporting the claim before the ICSID. A seven-member panel from Bangladesh was took part in the ‘Head of Loss’ discussion virtually that was administrated from Washington DC,” a senior official of Petrobangla told the Daily Observer on Thursday.
He said the discussion was focused on damages to the gas reservoir, damage of environment due to the gas blowouts and loss of the government for purchasing gas from other areas as it failed to tap the Tengratila gas.
Earlier, Petrobangla, the state-owned Oil and Gas Cooperation submitted the compensation claim to the ICSID against Canadian company Niko Resources for burning Bangladesh’s gas reserve due to negligence.ICSID found Niko liable for the two blowouts as the drillings was being carried out under its arrangements and supervision and it also ordered Niko to compensate the state-run Bangladesh Petroleum Exploration Company (Bapex) for the direct loss and damages caused by the blowouts.
“The tribunal said Niko was liable because of its failure to conduct operations diligently and in conformity with the standards of the international petroleum industry, compensation owed by Niko to Bapex includes the gas that escaped from of two gas blowouts in Chattak Gas field in Sunamganj on January 5 and June 24 in 2005,” Petrobangla’s lawyer Barrister Moin Ghani earlier told this correspondent.
The Court said the identification of other losses and damages that Niko must compensate, and the quantum of such compensation, is to be determined at the next phase of the pending arbitration case, according to Petrobangla.
Barrister Moin hoped the compensation would be over $1 billion due to the damage caused to properties and gas reserves in and around the gas field.
In line with the ICSID verdict, Petrobangla is set to submit the memorial before the court to get final verdict from the tribunal. Meanwhile, Bangladesh has engaged US-based law firm Foley Hoag LLP to assess the loss and damage issues of the blowouts.
As per schedule, ICSID will give its decision by the end of 2021 and accordingly the final hearing would start in July 2021, Moin Ghani said.