Bangladesh is passing through a cross road in its attempt to combat the present energy crisis.
While the government`s large and ambitious development programs specially in power sector are well conceived, there are many challenges that need to be addressed.
A fast depleting gas reserve has been the focus of major problem faced at the present energy scene. Major exploration for hydrocarbon has not been undertaken in the country over the last decade and little gas reserve could be added to the reserve base.
The present gas reserve may run out in about a decade considering the increasing gas demand. Yet geological analyses suggest that the offshore Bangladesh has very good gas prospect specially in the south eastern part along the Bangladesh-Myanmar maritime boundary.
This is testified by the several recent gas discoveries in the Arakan offshore basin in the Myanmar which borders Bangladesh water.
There has never been a "Plan B" by the past (four decades!) policy makers which could handle a situation when gas is depleted. Local coal development has a slow pace and only one coal mine produces coal too little to satisfy the future demand even in the short term. The present projection of replacing gas with coal for fuel supply specially in power generation is highly biased towards imported coal rather than the local coal development.
The projected electricity generation capacity of about 24,000 MW by 2021 and 40,000 MW by 2030 has been based on the assumption that primary fuel for its implementation would mainly be import base.
Large scale coal import and LNG import will form the core of energy supply in the face of a depleting gas reserve. LNG is overly costly and its introduction to the energy market in large scale would induce a price shock that may have serious implication on the economy of the country.
Large scale coal import has major challenges firstly in terms of development of infrastructure for its transport from outside and within the country, and secondly in terms of having an experience pool of people for its management.
There are several other options for Bangladesh for combating energy shortfalls. Cross border energy import either in the form of natural gas or in the form of electricity could well supplement the other areas of energy management in the short to long term future.
Bangladesh has already opened up a cross border electricity import trade with India and this could grow in coming years. In this respect the hydro electricity import option from Bhutan and Nepal, has been considered too reasonable to work for.
Both Nepal and Bhutan have enormous prospect of hydro power development and Bangladesh should take the opportunity to join the neighbours to implement an action plan whereby hydropower could be imported.
Bangladesh lost an opportunity of getting cross border pipeline gas from Myanmar when it decline to accept a Tri-nation (Myanmar-India-Bangladesh) gas pipeline agreement with Myanmar and India in 2005.
Recent media report that government is proposing India for a gas import deal for pipeline gas supply from Tripura to Bangladesh is a right step. The present stand-still status of transnational gas pipeline projects of either TAPI (Turkmenistan-Afghanistan-Pakistan-India) or IPI (Iran-Pakistan-India) may change to a more fast moving activity depending upon international political and economic scenario. However, should any of these projects get off the ground Bangladesh could get a very long term gas security if she can join the team of transnational gas traders?
Bangladesh should initiate a serious and practical program for hydrocarbon exploration both in the land and in the offshore. From the geological perspective it may be mentioned that significant reserve of gas may still be found by rigorous exploration program.
At the same time speedy way of developing its coal resource in the north Bengal should be undertaken. Development of indigenous energy resources should be done through enough exploration before import based costly energy options are undertaken. This will enable Bangladesh to avoid an energy price shock that would probably be inevitable otherwise.
Dr. Badrul Imam is an energy expert and Professor of Geology of Dhaka University.