Bangladesh Offers Better Terms in Offshore Oil & Gas Blocks Tender to Lure Investment Amid Shortages and High Costs of Imports: The Geology Shows Prospectivity

     Like many South Asian countries, Bangladesh has been strongly affected by the disruptions in the Strait of Hormuz. As a result, they have launched an international tender for oil and gas exploration in 27 offshore blocks in the Bay of Bengal, offering more attractive terms to foreign companies amid domestic gas shortages and reducing reliance on expensive LNG imports. State-run oil company Petrobangla has given a November 30 deadline for bid submissions.

“We have made the terms more attractive than before to encourage participation from international companies,” Energy Minister Iqbal Hassan Mahmood told a press conference.

“The offshore tender is part of the government’s action plan to increase domestic gas supply and reduce import dependence.”

     An offshore licensing round in March 2024 failed to attract a single bid despite several multinational companies purchasing data packages. The tender includes 15 deep-water and 12 shallow-water blocks in the Bay of Bengal. A review conducted after the failed 2024 round showed that foreign companies had raised concerns over gas pricing, pipeline construction costs, and profit-sharing obligations.

     Bangladesh resolved offshore border disputes with India in 2012 and with Myanmar in 2014. However, Bangladesh has yet to make a significant offshore gas discovery. Pakistan, India, and Myanmar have made discoveries and are continuing to drill offshore. Previous offshore Bangladesh exploration was done by major international companies, including ConocoPhillips, Santos, POSCO Daewoo, and ONGC, before they exited the projects.

     According to the Dhaka Tribune:

“The draft contract stipulates a nine-year exploration period. During the first four years, companies must complete geological surveys and either two-dimensional or three-dimensional seismic surveys. Two years will then be allocated for drilling exploration wells, followed by three years to move into production.”

“Petrobangla said geological surveys will be mandatory for all contracted companies.”

“Petrobangla expects offshore exploration activities to begin by the end of 2027 after completing the tendering and contractual processes.”

     The Bay of Bengal is considered to be a frontier exploration basin, contains the world's largest deep marine, and remains mostly unexplored for hydrocarbons. However, gas fields in the fan have been established, and the petroleum system is considered quite valid. Elisabeth Gillbard has written about the potential of the Bay of Bengal and provides a geological summary below.

“The Bengal Fan is the largest submarine fan in the world, with a length of up to 3000 km, a width of 1200 km, and up to 16 km of sediment thickness (Curray et al., 2003)”

“The Bay of Bengal is a rifted passive margin initially established during the disintegration of Gondwana (e.g., Curray, 1982; Powell, 1988; Curray, 1994). Rifting was initiated during the early Jurassic (~180 Ma) period, with the first oceanic crust forming in the Lower Cretaceous (120-130 Ma) as a result of the separation of the Indian and Antarctica plates (e.g., Gopala Rao et al., 1997). As India drifted northwards, it started its collision with Asia around 59 Ma, initiating the Himalayan uplift. However, the full hard continent-continent collision did not begin until around 15 Ma, resulting in the main Himalayan Orogeny and the major increase in sedimentation, which resulted in the deposition of the Bengal Fan. The Sunda Subduction Zone and Indo-Burman accretionary prism mark the eastern extent of the Bay of Bengal, active since approximately 20 Ma. Compression from this margin is evident in the east part of the area of interest (AOI), with structural deformation decreasing westwards.”

     Direct hydrocarbon indicators (DHIs) are present in the seismic data. Clusters of prograding fluvial-deltaic channel sands are prospective in the shallow submarine fan system, and basin floor fans and isolated channels are prospective in the deeper waters. 

“All the recent discoveries within the Bengal Fan have been sourced from intraformational biogenic gas contemporaneous with the reservoirs (Shoup et al., 2017). However, there is also considerable evidence for several thermogenic systems. The gas source for the nearshore Sangu Field has been typed to Miocene interbedded shales, and equivalent sequences were drilled in the BODC and Bina wells further offshore, where they were found to be oil-prone Type III shales (Baric et al., 1977). Pre-fan, Late Eocene to Early Oligocene source rocks actively produce oil and gas in adjacent Myanmar. Meanwhile, analogue basins offshore East India yield oil-prone source rocks of Upper Cretaceous age. Gas hydrates and direct hydrocarbon indicators (DHIs) are very common within the seismic data, proving an active gas system.”

 

References:

 

Bangladesh offers sweetened terms in offshore tender to tackle energy crunch. Ruma Paul. Reuters. May 24, 2026. Bangladesh offers sweetened terms in offshore tender to tackle energy crunch

Bangladesh launches offshore oil and gas bidding round for 27 Bay blocks: Government offers export opportunities, tax incentives and duty exemptions to attract foreign investors and boost energy security. Dhaka Tribune. May 27, 2026. Bangladesh launches offshore oil and gas bidding round for 27 Bay blocks

Unveiling the petroleum potential of one of the world’s last frontier petroleum provinces: the Bengal Fan, offshore Bangladesh. Elisabeth Gillbard. TGS. First Break, Vol. 42, May 2024. 23604-FB24 May_08 ST Gillbard 04-12.pdf