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Second round block bidding

Govt under pressure to include big cos

Star Report
Pressure from the diplomatic circle on the government is mounting in favour of big oil and gas companies as the Negotiation Committee of Energy Ministry continues to favour comparatively small ones in the second round block bidding, according to sources.
To satisfy some of the pressure groups, the government has taken a move to bring one of the big oil companies in the scene as a partner of a small company. This big company was left out from the negotiations.
However, the government offer to the oil giant to Join the small company as an Investor was rejected by the latter. Now. a decision has been taken that the said big company would not be approached for negotiations until the return of the Energy Secretary from USA. The Secretary went on a two-week private visit to USA last week.
Meanwhile, discussion between Shell and the Negotiation
Committee on the second round bidding for hydrocarbon exploration was held on Tuesday, one day behind schedule, as Shell's representatives could not arrive Dhaka In time.
Hondo, a small US company which was offered block 21. did not respond to the government offer. Hondo, with a three-year track record of negative growth, told the Negotiation Committee that it had not completed its studies on Block 21. Therefore it won't negotiate right now.
"In technical words. Hondo quits from the bidding process." said a source. "If someone does not want to negotiate over the block now, ft means it does not want to bid at all."
Hondo was the lone bidder for Block 21.
Meanwhile, the US company, Mobil, which had jointly submitted proposals with Petronas and BAPEX for blocks 9 and 11, has sent a letter to the Prime Minister questioning transparency in the bidding process.
Sources said that India based US company Enron last week experienced bitterness with the Negotiation Committee as representatives of this company had to wait for the whole day to meet the committee.
The negotiation Is now going on a slow pace as one of the members of the Negotiation Committee and the Energy Secretary are absent for the last one week.
Sources said the diplomatic circle is creating indirect pressure now by questioning transparency in the on-going bidding process for signing of production sharing contracts with different companies for 12 blocks.
"Their pressure will mount If the bidding concludes in the manner it is now being held," a source noted.
The on-going negotiations are being held on "one block, one company/group" formula. The government Is not following any open evaluation criterion for selection of the companies for negotiation.