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Success of power generation eclipses by fuel shortage

Present government over the past seven and a half year of time in state power made impressive achievement in power generation capacity.

But the remarkable success of increasing power generation capacity is being eclipsed from failure in ensuring sustainable supply of fuel for power and expanding power transmission and distribution networks accordingly.

The overall energy security appears vulnerable for lack of sustainability of fuel supply for energy. The present summer and irrigation season has already experienced major load shedding adversely impacting upon Industrial, business and commercial activities.

The present installed capacity is 12,339 MW (including 600 MW import from India). The highest generation recorded so far was 8,348 MW on April 9, 2016.

Restricted gas supply and unreliable liquid fuel supply is blamed for the present unsustainable power sector scenario. Government has almost spent 50% of its tenure of its second consecutive term.

One of the major challenges that it has to successfully encounter is achieving sustainable energy security. Maintaining impressive GDP growth rate at 6 % plus and improving it for achieving national visions of medium income country in 2021 and developed country status by 2030 may become extremely difficult if challenges for achieving the sustainable energy are not successfully encountered.

Constraints in fuel supply and restrictions of power transmission and distribution system handicaps government in power generation above the present level of 7,500- 8,000 MW on the average.

Power System Master Plan-2010 have a vision to achieve power supply to all by 2021. Power sector vision envisages achieving a power generation target of 24,000 MW by 2021, 40,000 MW by 2030 and 60,000 MW by 2040.

Own natural gas still dominates (61.82%) of the power generation fuel mix. The national gas production capacity from 20 producing gas field is now 2,740 MMcfd.

About 1,035 MMcfd of this gas is being supplied for power generation. Petrobangla has suspended gas supply to four of the seven urea fertiliser plants to increase gas supply to power plants.

Power Development Board (PDB) claims that it can generate 4,671 MW power from the gas that it gets. The total capacity of gas based power generation is 7,628 MW.

Theoretically, another 2,957 MW could be generated if Petrobangla could meet the full demand of gas of PDB. Additional 250 MMcfd gas is required for meeting the full demand of gas based power generation.

This is not possible in near future till gas sector scenario is supplemented with import of LNG and some major new gas resource is discovered and developed.

There is a possibility of getting 500 MMcfd equivalent LNG supply commencing from early 2019. But gas system is already suffering from 500 MMcfd deficit which by that time may grow wider. Petrobangla requires supplying gas to fertiliser, CNG, industrial, commercial and domestic suppliers apart from power sector.

Power Generation Scenaro:

It appears from PDB website accessed on 10 May 2016 that 7,700 MW generation could be achieved during  the peak hours ( 5PM -11 PM) and 6,085 MW during off peak hours.

PDB received 1,035 MMcfd gas supply for power generation on the day which generated 4,671 MW power. PDB could produce another 807 MW power during the peak hours if served with gas as per demand. On the previous day (9 May 2016) PDB failed to generate 807 MW additional power during peak hours for restricted gas supply which was 920.55 MMcfd.

Media report evidence that 99 of 101 power plants are now ready for generation. Of these 80-85 power plants can operate these days.

The installed generation capacity of these plants is 12,339 MW. Of this 7,628MW is gas based, furnace oil contributes 2,675 MW, diesel 956MW, power import 600 MW, coal and hydro makes marginal contributions.

About one third of the available power generation capacity cannot be accessed for gas supply constraints these days. Moreover, reliance on liquid fuel based power generation increases cost of generation.

 

The supply chain of liquid fuel is also uncerain. A recent industrial dispute of riverrine transporation of liquid fuel created serious mieries for the citizens during hot humid summer days.

Fuel Supply Major Constraint:

Gas supply constraints handicaps power generation capacity utilisation. Government has failed to explore and develop new gas resources keeping pace with demand growth. It could not also diversify fuel mix for power generation through exploring own discovered coal reserve for policy dilemma.The projects for coal and LNG imports are running well behind schedule

Gas Supply Scenario:

Since 2000 till now exploration activities for natural gas in onshore and offshore could not match with growing demand. During this period about 8.2 Tcf of proven reserve against which the new addition is only 1 Tcf.

Failure to expedite gas exploration and at the same time growing demand for gas has widened the deficit in national gas grid The present production capacity of 20 producing gas field is 2,740 MMcfd. Government states of 500 MMcfd deficit even after increasing the production by 1,000 MMcfd from 2009. Most of the increase in production came from discovered gas fields (Bibiyana, Titas and Jalalabad).

Four gas fields now produce about 85% of the total production. Petrobangla owned company BAPEX discovered some marginal gas fields. But the contribution of these fields is insignificant compared to huge deficits. Exploration in the onshore area excepting the already assigned blocks to IOCs remained restricted to BAPEX only.

ConocoPhillips operating in offshore after spending valuable time and doing very little in exploration relinquished their blocks. Petrobangla did very little in expediting offshore exploration even after positive resolution of the maritime boundary disputes with Myanmar and India.

The Petrobangla initiative for engaging multi-client survey contractor for deep water in the Bay of Bengal got delayed for Prime Minister’s Office advising retendering.

The entire process has been put back at least one year. While Bangladesh failed to conclude any new production sharing contract (PSC) in the offshore exploration after maritime boundary dispute Myanmar could sign 23 PSCs and one of the companies discovered a significantly large reserve in a block adjacent to Bangladesh maritime boundary.

Table: Recoverable Gas Reserve

Discovered Gas Fields

Gas In Place

(Tcf) 

Proved Reserve (1P)

Tcf

Proved+ Provable(2P)

Tcf

Proved + Probable +Possible (3P) Tcf

Cumulative Production Tcf

(30/06/2016)

Remaining Reserve Tcf

(30/06/2016)

26

37.68

20.60

27.12

31.31

12.14

14.98

Reference: Petrobangla Website

1P = 90-100% possibility, 2P= 51-90% possibility, 3P= 10-49% possibility

BAPEX is set to conclude joint venture agreement with an IOC for further exploring some identified prospects in the greater Chittagong area. Government has also assigned BAPEX the task for managing implementation of drilling 108 gas wells including 58 exploration wells over the next five years.

The total numbers of gas wells drilled in the region called Bangladesh from 1910 is 139 of which 75 are exploratory wells and 64 are appraisal cum development wells.

Considering the present technical, managerial, financial and equipment capabilities it will be a huge challenge for BAPEX to achieve the target.

Government is trying to engage IOC in some potential offshore blocks without announcing formal bidding round under the coverage of  “Speedy Supply of Power and Energy (Special Provision) Act, 2010”.  Work for engaging a consultant for assisting Petrobangla in updating model PSC is also advancing.

 

Drilling History of Bangladesh Region: From 1910-2008

Exploratory Wells

Appraisal Cum Development Wells

75

64

Source: Petrobangla Website Updated

It appears from all these works that significant addition to present depleting gas reserve may not happen in less than 7-10 years. In the meantime the present reserve will continue to deplete. The present production capacity may also be progressively reduced. It is forecasted that by 2030 the present reserve may completely deplete at the present rate of use unless a large new reserve is discovered soon. The only other way of maintaining the present level of gas supply in gas grid is importing LNG and demand side management.

Production Table:  04-05 May 2016

Company

Gas Fields

Producing Wells

Production Capacity (MMcfd)

Production On the day

(MMcfd)

% of Total Production

BGFCL

Titas

21

518

513.80

18.70%

BGFCL

Habiganj

  7

225

224.90

  1.30%

BGFCL

Bakhrabad

  6

43

 35.90

  1.00%

BGFCL

Narshingdi

  2

30

 28.20

  1.00%

BGFCL

Meghna

  1

11

13.70

  0.50%

SGFL

Sylhet

  2

08

 08.10

  0.30%

SGFL

Kaillashtilla

  5

73

70.80

  2.60%

SGFL

Rashidpoor

  5

60

  57.00

  2.10%

SGFL

Beanibazar

  1

09

09.50

  0.30%

BAPEX

Salda

  1

    10

    09.10

  0.30%

BAPEX

Fenchuganj

  3

    35

    34.00

  1.20%

BAPEX

Shahbazpoor

  2

    60

    18.80

  0.70%

BAPEX

Semutang

  2

    03

    03.00

  0.10%

BAPEX

Sundalpoor

  1

    03

    03.40

  0.10%

BAPEX

Srikail

  2

    40

    37.20

  1.40%

BAPEX

Begumganj

  1

      2

      0.30

  0.00%

Subtotal

16

62

1120.00

1067.90

39.00%

Chevron

Jalalabad

    6

  260.00

  279.00

10.20%

Chevron

Maulavibazar

    5

    50.00

    42.20

01.50%

Chevron

Bibiyana

  24

1200.00

1251.40

45.70%

Tullow

Bangura

    4

  110.00

    99.70%

  3.60%

Subtotal

 4

  39

1620.00

1672.00

61.00%

Grand Total

20

101

2740.00

2740.40

100%

 

 Petrobangla Daily Gas Production Report: 04-05 May 2016

The Petrobangla daily gas production report evidences that 3 national production companies BGFCL, SGFL and BAPEX from 62 producing gas wells of 16 gas fields produce 39.00 % ie  1,067 MMcfd . Two IOCs Chevron and Tullow from 39 wells of four gas fields produce 61% i.e 1,672 MMcfd.

Jalalabad and Bibiyana are consistently production above capacity. Three gas fields Bibiyana, Titas and Jalalabad together produce 74.60%. Bibiyana alone produces 45.70%. Four out of seven fertiliser factories and several power plants remains shut down for lack of gas supply.

Gas System Supply Is Vulnerable:

The failure in carrying out regular exploration and development of new gas resource, relying on existing discovered gas fields for increasing production and failure in demand side management has created huge deficit in production level. Moreover, relying on Bibiyana, Titas, Jalalabad and Habiganj gas fields for about 90% production has made gas supply system vulnerable.

Any technical problem leading to forced outage in any of the field may causing embarrassing situation in gas franchise.

LNG Import Initiatives:

Government initiated LNG imported action plan in 2010. The original plan for importing 500 MMcfd equivalent LNG through setting up Floating Storage and Gasification Unit (FSRU) at Matarbari and constructing a 91 KM gas transmission pipeline from Matarbari to Anowara was expected to be completed by 2013. LNG import was primarily targeted for gas starved greater Chittagong region. 

After prolonged delays Petrobangla has initialed pre contract document with an US company for setting up FSRU in April 2016. Government has a Government to Government MoU with the Government of Qatar for supplying 500 MMcfd equivalent LNG. Tender will soon be launched for procuring LNG from other sources soon. The construction works for Gas transmission pipeline and associated facilities is advancing.

The pipeline and facilities is expected to l be ready for use by middle to end 2017. FSRU is also expected to be ready for use by then. Now, government has to negotiate and conclude contracts for LNG supply.

Government has taken few more initiatives for LNG import. These are

  • Power Cell initiative for setting up 500 MMCFD land based LNG terminal at Maheskhali
  • Petro Bangla plan for a LNG terminal of 500 MMCFD at Maheskhali and a third at Paira Port area
  • Indian Company Reliance Proposed 500 MMCFD capacity LNG Terminal at Maheskhali
  • North West Power Generation Company is negotiating with H Energy India for importing LNG for its 800 MW imported LNG based power plant in Khulna. Couple of the above projects has advanced a bit but others are at conceptual stage. A project wise discussion may clarify the situation where Bangladesh stands in LNG import initiative.

Land based LNG terminal projects in Bangladesh onshore areas need techno economic feasibility study as LNG terminals would require 12meter plus all season draft for smallest LNG vessels to anchor. Power cell is the process of engaging a consultant for feasibility study. Government has an ambitious plan for importing 2000 MMCFD equivalent LNG by 2021.

 

Domestic Coal Resource:

Bangladesh has five discovered coal mines in the greater Rangpoor and Dinajpoor region. Mining is going on at Barapukuria using Long wall Top Caving (LWTC) underground mining method.

The total proven + probable reserve excluding Jamalganj mine is 884 Million tones.  Barapukuria mine is feeding mine mouth 2 X125 MW Power plants.

 

Coal Mine/Field

Year of Discovery

Depth of Coal Seam (Meter)

Proven In SituReserve (Million Tons)

Proven +Probable Reserve (Million Tons)

Status

Barapukuria Coal Mine,Dinajpoor

1985-1987

118-509

303

390

In production Utilizing Long WallTop  Caving Underground Mining Method

Khalspeer ,Rangpoor

1989-1990

257-483

143

685

Development Under Consideration

Phulbari ,Dinajpoor

1997

150-240

288

572

Development Under Consideration

Dighipara,Dinajpoor

1994-1995

328-407

150

600

Development Under Consideration

Jamalganj ,Joypoorhat

1962

640-1158

 

1053 (estimated )

Investigation for Coal Bed Methane (CBM) extraction is in progress

Total (Without Jamalganj)

 

 

884

2247

 


Source: Geological Survey of Bangladesh (GSB), Petrobangla (as of December, 2007)

Mining from other coal fields are put on hold pending the approval of coal policy which under consideration since 2005. Bangladesh coal mines are characterized soft silty overburden, thick multi seam coal layers below a large water body. The coal seams of four out of five mines are at 118-483 meters depth. Coal mining requires extensive techno economic feasibility studies for determining the most economically viable and technically feasible mining method.

BHP Minerals discovered Phulbari Coal Mine in 1997 under a mining lease and exploration contract with the Government of Bangladesh. That contract was later assigned to Asia Energy Corporation (A GCM Group of Company). Asia Energy Corporation engaging accredited mining consultants carried out extensive techno economic feasibility studies submitted Scheme of Development (SOD) in end 2005 suggesting open pit mining.

Their proposal still remains pending. In 2005 an unfortunate incident in the Phulabri area led to killing of few villagers by the law enforcing agency when they were protesting violently against mining. A left leaning environmental group is agitating since then against open pit mining in the excuse of perceived impacts such a desertification, loss of agricultural land, serious issues of relocations and rehabilitation?

A high powered government committee submitted a report on various aspects of mining including appropriate mining method. Their suggestion was to conduct open pit mining on the northern flank of Barapaukria.

According to that report open pit mining was the most suitable method for Barapukuria and Phulbari. But government neither responded to Asia Energy Scheme of Development nor acted as per suggestion of its own committee. Even they did not follow the recommendations of PSMP 2010. All these have made it impossible to achieve the targeted contribution of local.

                                                                         

                                                                              Coal Quality

Sl. No

Name

Rank of Coal

Gross Calorific Value, btu/lb

Ash (%)

Volatile Matter (%)

Sulfur (%) 

Moisture (%)

Fixed Carbon (%)

1

Barapukuria Coal Mine

High Volatile Bituminous  Coal

11,040

12.40

29.20

0.53

10.00

48.40

2

Phulbari Coal field

11,884

15.0

36.00

<1

2.40

51.50

3

Khalashpir Coal Field

12,700

13.30

22.15

0.67

2.14

59.90

4

Jamalganj Coal Field

11,800

Data not found

38.00

0.60

Not tested

35.00

5

Dighipara Coal Field

Not determined

 

Bangladesh coal is high heating value, low ash and low sulfur coal. These are highly suitable for use in less emitting supercritical and ultra-super critical technology power generation that has been planned for new power plants in Bangladesh.

PSMP 2010 suggested for activelydeveloping domestic primary energy resources to maintain domestic primary energy supply over 50%. But till middle of 2016 government have carried out Less than bare minimum exploration and development of natural gas resources.

This has created huge deficit in national gas grid. About 8.1 Tcf gas has been used from proven recoverable gas reserve between 2000-2015 against which the addition of new reserve is 1Tcf.

At this rate domestic gas may deplete completely by 2030 unless significantly large new reserve is discovered and developed soon. Exploration and development of own coal resource is impeded from failure of adopting coal policy.  This situation raises concern that domestic primary fuel may not retain over 50% in 2030.

Bangladesh has adopted several projects for coal import and set up imported coal based power plants. Import LNG to offset deficit of gas. Coal and LNG import need setting expensive and technologically driven import infrastructure development.

If Bangladesh does not attach priority for own primary fuel resource development by 2030 Bangladesh will become over 90% dependent on imported fuel.

That situation may not be sustainable considering volatile nature of global energy supply value chain and geo politics. Bangladesh to avoid that situation must start exploring own coal as soon as possible and expedite exploration for gas in onshore frontier areas and offshore.

It must also adopt strategy for appropriate value added utilization of gas phasing out gas supply to end users which can use alternate fuel. If the process is not initiated soon success of government in enhancing power generation capacity will continue to remain eclipsed for fuel supply constraints.

Saleque Sufi is an energy expert.

 

 

 

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