Myanmar gas bypasses India, Bangladesh Badrul Imam IN a conclusive move, Myanmar decided to sell its newly discovered offshore gas to China, dashing Indian and Bangladeshi hopes. It is only recently that Bangladesh showed its interest in reviving the Myanmar-Bangladesh-India tri-nation gas pipeline talk with its neighbours, which perhaps came from the realisation that it would bring economic benefit through transporting gas to India, and also through importing gas from Myanmar. But Bangladeshi handling of the tri-nation pipeline proposal, first placed about a decade ago, was initially marked by no decision to delayed decision. And after she decided to get on board, she left the platform in 2005 because of disagreement on some bilateral issues with India. India, on its part, tried to get an alternate route for gas transport from Myanmar but failed to make it economically viable. In the meantime, Myanmar decided not to waste further time on these partners and signed an agreement with China. Commenting on the recent Bangladeshi interest in tri-nation gas pipeline, a western observer commented that the train Bangladesh wants to catch has already left the station. Some tend to believe that the tri-nation gas pipeline will not bring much benefit to the country, and that it may have an in-built element of risk of creating conflict between the two nations. Others hold an opposite view, and believe that the tri-nation gas pipeline would bring economic benefit to all the three countries in the same way that the trans-border gas pipelines in many countries of the world have proved beneficial. In particular, for a country like Bangladesh where the present gas shortage will turn into a crisis in future, the tri-nation gas pipeline will bring the option of tapping the gas resource of a neighbouring country. The question is, has Bangladesh missed an opportunity? Losing the gas race: The discovery of three large gas fields a few years ago in the Bay of Bengal off the Arakan coast of Myanmar and the willingness of Myanmar government to export the gas brought about the possibility of trans-border gas trade among its neighbours. The three gas fields -- Shwe, Shwe phu and Mia -- were discovered by a Korean oil company, Daewoo International, with two Indian partners. India, has been very eager to buy the gas from the very beginning. A private company in Bangladesh, Mohona holding Ltd, placed a proposal before the respective governments for building a tri-nation gas pipeline to transport gas from Myanmar to India via Bangladesh. Bangladesh, for a long time, did not show much interest in the proposal. However, at a later time, all the three countries agreed on principle to go ahead with the proposal. After the ministers of the three countries concluded their meeting with positive notes, the responsibility of drawing up details of the proposal was given to a tri-nation Technical Committee. In early 2005, the tri-nation Technical Committee met in Rangoon. Bangladesh proposed some changes in the original proposal, which are: 1) The pipe line will enter Bangladesh via the southern Teknaf border instead of Brahmanbaria border and would proceed towards Chittagong before proceeding toward India, 2) The pipeline would be constructed under the sponsorship of an international consortium instead of Indian sponsorship, 3) The Bangladesh section of the pipeline will be operated by a Bangladeshi company -- (GTCL) -- for which it would charge a fee for gas transport, and 4) The pipeline should have open access nature with provision for injection and siphoning of gas by Bangladesh and India at designated intake and off-take points along the line. These points were accepted in principle both by India and Myanmar, subject to further discussion. Bangladesh gave India three more conditions: 1) India has to allow Bangladesh a corridor to import hydro-electricity from Nepal and Bhutan, 2) India will ensure unhindered access of merchandise to travel between Bangladesh, Nepal and Bhutan through a corridor, and 3) India will take measures to reduce huge trade deficits of Bangladesh. The Indian side declined to negotiate or accept these points in a tri-nation gas pipeline forum. In response, Bangladesh withdrew from project. After Bangladesh backed out, India tried to find an alterative pipeline route bypassing Bangladesh. It considered a route from Myanmar via Mizoram, Tripura and Assam to Siliguri and finally to Kolkata. But this route was 500 kilometres longer than the one proposed via Bangladesh, and an extra Tk.2,500 crore would have to be added to the cost of construction. Furthermore, the security of the pipeline was an issue nobody was comfortable with because of the militant activities of the Assamese and Garo rebels in the area. With little other options in hand, India fell behind other competitors in the Myanmar gas race and was eventually left out. The Myanmar government wasted no more time with her westerly neighbours and instead concluded the gas deal with China in late 2008. Daewoo International signed the deal with China National Petroleum Company (CNPC). It will invest $5.6 billion to develop the gas fields. Gas will be supplied to China for 30 years beginning 2013, initially at a rate of 600 million cubic feet per day. Chinese will build the pipeline from Myanmar to Yunan province in China. The way ahead for Bangladesh: The energy needs of most developing nations outpace their internal resources, which results in their quest for foreign resources they can possibly share. As the newly discovered gas reserves off the Arakan coast (Myanmar) were put up for sale, Indian buyers competed with China and Bangladesh. India could not produce a blueprint of a pipeline to get the gas and lost the race to China. The recent Bangladeshi request to import the gas from Myanmar was also turned down. However, Myanmar said that Bangladesh could purchase gas from any new gas discovery in future in that area. In the context of the looming gas crisis in medium to long term future, Bangladesh should take this offer seriously and prepare ahead of time, should such an opportunity arrive. Bangladesh should keep open the options of a tri-nation (Myanmar-Bangladesh-India) as well as a bi-nation (Myanmar-Bangladesh) gas pipeline for bringing in the gas. In case of a tri-nation pipeline, Bangladesh may earn money on a yearly basis and thus may get at least part of the gas free, in addition to having the gas pipeline infrastructure added for no cost. A bi-nation gas pipeline would be exclusive and dedicated although there would not be any free gas for Bangladesh. Bangladesh is yet to realise the severity of an upcoming gas crisis in the mid to long-term future. For this small country with limited resource and a very large population, it is perhaps inevitable that she will look beyond her border for gas to meet the ever-increasing demand. Dr. Badrul Imam is Professor, University of Dhaka and Visiting Faculty, University of Regina, Canada http://www.thedailystar.net/story.php?nid=117987 |
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