Category: Energy and Power

The Bangladesh Petroleum Corporation (BPC) has begun the process of hiring an international project management consultant to supervise the construction of the Eastern Re?nery Limited (ERL-2) expansion project in Chattogram, aimed at reducing reliance on imported re?ned petroleum products. The state-owned corporation has invited global consulting ?rms through an Expression of Interest to oversee engineering, procurement, and construction works for the re?nery’s major upgrade at North Patenga. The project is planned to modernize and expand the existing re?nery, increasing its crude processing capacity from around 15 lakh tonnes to about 45 lakh tonnes per year. The expansion project, fully ?nanced by BPC, is scheduled for implementation between December 2026 and November 2030

The Centre for Policy Dialogue (CPD) has called for comprehensive ?scal reforms to remove policy biases favoring fossil fuels and accelerate Bangladesh’s transition to renewable energy.

at a press brie?ng in the capital recently, CPD Research Director Dr Khondaker Golam Moazzem presented a study titled ‘Fiscal Discrimination between Fossil Fuel and Renewable Energy: Alternate Solutions to Address the Energy Crisis.’ The study found that fossil fuelbased power projects have received more than 95 percent of development budget allocations over the years, while renewable energy initiatives have received less than ?ve percent, discouraging investment in clean energy technologies.

according to the report, lique?ed natural gas (LNG) imports enjoy signi?cantly lower tax burdens than renewable energy technologies such as solar equipment, lithium-ion batteries, electric vehicles and grid infrastructure.

Hydrocarbon reserves cannot be increased without drilling. Exploration drilling, one of the most expensive and high-risk activities in the petroleum industry, is considered the central part of oil and gas exploration.

in reality, drilling is only the ?nal step in a much broader decision-making process. Before a well is drilled, extensive geological, geophysical, engineering, and economic studies must be carried out.

the exploration process usually begins with geoscientists, who identify potential hydrocarbon-bearing structures and evaluate geological uncertainties.

this is one of the most important early stages of the drilling process. Reservoir engineers then estimate production potential and possible hydrocarbon recovery. Drilling engineers assess well design, operational feasibility, and technical risks, while petroleum engineers/ economists evaluate project pro?tability, investment risk, and longterm economic viability.

a drilling decision should therefore be based on integrated technical and economic analysis rather than on a single seismic anomaly or structural feature.

it must answer several important questions before drilling: 1. How possible is it that the geological structure can effectively trap and seal hydrocarbons? 2. How likely is the reservoir to have suf?cient porosity and permeability for hydrocarbon storage and ?ow? 3. How effective is the seal in preventing hydrocarbon leakage? 4.

are hydrocarbons likely to have migrated into the trap? 5. What is the geological probability of success? 6.

is the project economically feasible? 7.

are there alternative prospects with better investment potential? etc. Modern seismic technology and riskanalysis tools help exploration teams make better and more transparent drilling decisions.

these methods allow experts to compare different possibilities, understand uncertainties, and estimate both technical and ?nancial risks.

instead of relying onassumptions alone, companies can use data-driven analysis to identify the most promising prospects, reduce the chance of costly dry wells, and improve overall exploration planning and management decisions for economic growth.

importance of Data Analysis During the early period of petroleum exploration, geoscientists relied on basic seismic interpretation and visible ‘bright spots’ to identify possible hydrocarbons. Due to limited computing and seismic technology, advanced seismic attribute analysis was uncommon. Modern oil and gas exploration now uses advanced computer analysis and seismic evaluation methods to better understand underground conditions, which improves the chances of successful drilling. Different seismic attributes, which are measurable indicators extracted from seismic data, and Direct Hydrocarbon Indicators (DHIs) are widely used in modern petroleum exploration to identify possible oil and gas accumulations, reservoir quality, and fault systems. However, no single seismic indicator can provide a completely reliable interpretation.

therefore, multiple seismic attributes, DHI responses, and geological models should be carefully integrated and cross-checked before making drilling decisions. Chance of Success (COS) Evaluation After identifying the potential presence of hydrocarbons within a geological formation, the next step in petroleum exploration is to evaluate the associated geological risks and uncertainties. Geological Chance of Success (COS) is a fundamental tool used in the risk assessment process to estimate the probability of discovering commercially recoverable hydrocarbons within a prospect.

as illustrated in Figure 1, successful hydrocarbon accumulation depends on the simultaneous occurrence of several independent geological elements within a petroleum system. Failure of any critical element may signi?cantly reduce the probability of exploration success.

the major geological factors considered in COS evaluation include: ? Source Rock: Presence of mature source rock capable of generating hydrocarbons (oil and/or gas). ? Reservoir: Presence of porous and permeable rock with suf?cient storage capacity and ?uid transmissibility. ? Seal and Trap: Presence of an effective cap rock and structural or stratigraphic trap capable of preventing hydrocarbon leakage. ? Migration and Timing: Successful migration of hydrocarbons from the source rock into the reservoir trap at the appropriate geological time. Figure 1. Simpli?ed geological model illustrating hydrocarbon generation, migration, trapping, reservoir accumulation, and seal con?guration within a petroleum system.

the overall COS is commonly estimated by multiplying the probabilities of these independent geological factors: COS = Psource×Pmigration×Preservoir ×Ptrap×Pseal×Ptiming For example, if the probabilities of source rock presence, hydrocarbon migration, reservoir quality, trap integrity, seal effectiveness, and timing are estimated as 60%, 65%, 90%, 80%, 85%, and 75%, respectively, the resulting overall COS is approximately 18%.

in simple terms, the overall chance of success depends on several uncertain geological factors working together.

if any one of these critical factors fails or is absent, the exploration well may ultimately fail.

a study conducted by ExxonMobil and published in Benchmarking Exploration Predictions and Performance Using 20+ Years of Drilling Results: One Company’s Experience by Rudolph and Goulding (2017) reported that prospects supported by advanced analytical techniques achieved signi?cantly higher exploration success rates compared to those evaluated without advanced analysis support.

the study further indicated that the average exploration drilling Success for these prospects exceeded 72%.

the research also demonstrated that approximately half of exploration failures were associated with trap- and seal-related issues, indicating that these geological uncertainties are among the major contributors to dryhole risk.

in addition, 27% of failure cases were attributed to the absence of effective source rocks or unsuccessful hydrocarbon migration, while nearly 22% of failures occurred due to inadequate reservoir quality, where the rock lacked suf?cient porosity to store hydrocarbons effectively.

improved uncertainty analysis can reduce the chance of costly dry holes and save millions of dollars in exploration expenses.

the Chance of Success (COS) evaluation shouldfollow a structured and evidencebased approach using standard checklists to ensure that all the key geological factors are assessed.

input from multidisciplinary experts and independent peer reviews is essential for improving reliability and supporting better exploration decisions.

uncertainty in Reserve Evaluation While the Chance of Success (COS) indicates the probability of hydrocarbon presence, it does not determine the quantity of recoverable oil or gas.

therefore, before drilling an exploration well, petroleum companies undertake estimating the potential volume of hydrocarbons that may be present in the subsurface.

these estimates are derived from seismic surveys, geological interpretations, petrophysical analysis, and data obtained from nearby wells. However, the exact quantity of hydrocarbons cannot be determined before drilling because many subsurface conditions remain uncertain.

important reservoir properties such as reservoir thickness, porosity, hydrocarbon saturation, and reservoir size are usually estimated within a range of possible values rather than as ?xed numbers.

this helps account for geological uncertainty in reserve estimation. For example, if reservoir thickness is estimated to vary between 15 and 20 meters, the estimated reserves will also vary within a range. Since several uncertain factors in?uence reserve estimation at the same time, single-value calculations may produce unreliable results.

to better quantify uncertainty, petroleum companies commonly use a probabilistic technique using Monte Carlo simulation.

this method generates thousands of possible reserve scenarios by combining different values of reservoir parameters within their uncertainty ranges. The simulation results are typically presented as probability distribution curves and histograms.

these simulations help technical and management teams evaluate: ? The most likely reserve size, ? The possible minimum and maximum reserve volumes, ? The level of technical and ?nancial risk, and ? The probability of commercial success. In Figure 3, the simulation results demonstrate that the estimated gas reserve may vary over a wide range of possible outcomes.

the graph also highlights important probabilistic reserve estimates, including: ? P10 – Optimistic estimate, indicating a 10% probability that the actual reserve will exceed this value, ? P50 – Most likely or median estimate, and ? P90 – Conservative estimate, indicating a 90% probability that the actual reserve will exceed this value.

as Figure 3 shows, the histogram and cumulative probability curve provide a clear visualization of uncertainty, enabling decision-makers to evaluate exploration risk more effectively and make more informed investment decisions. When multiple exploration prospects are available for investment consideration, uncertainty analysis helps decision-makers to: ? Understand both upside potential and downside risk, ? Compare multiple drilling opportunities, ? Prioritize exploration and investment decisions, ? Allocate exploration budgets more ef?ciently, and ? Improve overall exploration planning and risk management. Figure 3.

example of Monte Carlo simulation output for hydrocarbon reserve estimation. Commercial Success Evaluation Geological success does not necessarily guarantee commercial success.

even if hydrocarbons are discovered, the projectmay still be economically unviable. Therefore, economic evaluation is one of the most important stages in determining the commercial feasibility of an exploration project before drilling. Economic feasibility studies commonly include: ? Net Present Value (NPV), ? Internal Rate of Return (IRR), ? Payback Period, ? Break-even Analysis (the point where pro?t equals cost), ? Sensitivity Analysis, and ? Risk-adjusted Valuation (Expected Monetary Value (EMV)). Among these, Net Present Value (NPV) is one of the most widely used economic indicators, calculated based on estimated recoverable hydrocarbon reserves, projected production pro?les over the life of the ?eld, development and operational costs, and forecasted oil or gas prices.

accurate estimation of recoverable reserves and production performance is critically important for reliable NPV calculation.

therefore, reserve estimation and production forecasting should be carried out by petroleum engineers using the geological, geophysical, petrophysical, and reservoir engineering data. Petroleum economists and ?nancial analysts are also involved in the evaluation process.

they assess the economic indicators, market conditions, project uncertainties, and overall ?nancial risks of the exploration project. Risk Reduction through Integrated Analysis Exploration risk can never be eliminated because subsurface geology always contains unknown factors.

therefore, the primary objective of exploration analysis is not to remove risk entirely, but to minimize it as much as possible before drilling. Figure 4 illustrates how exploration risk gradually decreases as additional geological, geophysical, and engineering information becomes available during the exploration process.

initial stages, such as regional geological studies and 2D seismic interpretation, contain high uncertainty.

as more advanced techniques, including 3D seismic analysis, integrated subsurface studies, reservoir modeling, and economic evaluation, are applied, uncertainty is progressively reduced. However, the ?gure also demonstrates that exploration risk can never be eliminated, and some level of uncertainty always remains before drilling. Figure 4.

example of a risk-based exploration framework showing how exploration risk decreases with increasing geological and engineering information before drilling Quantitative Prospect Ranking After completing the technical and commercial evaluation of individual exploration prospects, companies commonly apply a quantitative prospect ranking framework to identify the most economically attractive investment opportunities among multiple alternatives. Quantitative prospect ranking is critically important for top management when making exploration drilling decisions. By prioritizing investment in the most prospective drilling opportunities, a company can: ? Minimize the risk of drilling failure, Maximize ?nancial returns, ? Achieve faster recovery of invested capital, ? Generate pro?ts that can be reinvested into future exploration and development activities, ? Support long-term growth, and ? Improve the overall success and sustainability of the company For example, consider ?ve hypothetical exploration prospects named Wells A, B, C, D, and E. Geoscientists estimate the COS for each prospect, while reservoir engineers estimate recoverable reserves. Drilling engineers estimate drilling costs. Based on these technical inputs, a risk-based economic evaluation can be performed using parameters such as Net Present Value (NPV), Expected Monetary Value (EMV), and Cost-Bene?t RatioTable 1 shows how companies compare different drilling opportunities using both risk and potential pro?t.

table 2. Prospect Ranking Based on Expected Monetary Value (EMV). Expected Monetary Value (EMV) combines possible pro?t with the probability of successWell E ranks highest based on Expected Monetary Value (EMV) because it combines a relatively high Chance of Success (40%) with reserve potential (67 BCF).

although Well D contains the largest estimated reserve volume, its relatively low COS signi?cantly reduces its overall risk-adjusted economic value.

this analysis demonstrates that both geological probability and reserve size are critical factors in exploration investment decision-making.

the above example demonstrates how quantitative prospect ranking further supports decision-making by integrating all uncertainties into a single evaluation framework and helping identify the best option among multiple opportunities. Conclusion It is not possible to eliminate exploration risk. However, a structured risk-based framework can signi?cantly improve drilling success rates and support responsible investment decisions in the petroleum industry. Each exploration prospect should be assessed through integrated seismic interpretation, geological risk assessment, uncertainty analysis, Chance of Success (COS) evaluation, and economic feasibility studies. Quantitative prospect ranking helps management compare exploration opportunities objectively, optimize investment decisions, and improve long-term exploration success. Ultimately, modern petroleum exploration is not simply about drilling wells, but about making informed scienti?c and economic decisions in an environment of uncertainty and risk. Therefore, before initiating any drilling program, it must be ensured that every stage of the pre-drill analysis process has been evaluated thoroughly and accurately.

A parliamentary special committee has proposed expanding strategic fuel reserves to cover a minimum of three months of demand, while urging diversi?ed import sources and stronger measures to curb hoarding and smuggling.

the committee’s chief Energy Minister Iqbal Hassan Mahmood presented the report on the opening day of the FY2026-27 budget session in parliament recently.

the report, titled Actions Required to Mitigate the Recent Fuel Situation, outlines strategies to safeguard national energy security. The report said recent pressure on the country’s fuel supply system was driven by rising international oil prices, con?ict in West Asia, disruptions in shipping through the Strait of Hormuz, global supply chain instability, and domestic factors including panic buying, illegal stockpiling and black market activity.

it added that the impact was felt across transport, agriculture, industrial production and the daily lives of citizens.

The United Arab Emirates (UAE) has assured Bangladesh of all possible cooperation in the energy sector.

the assurance was given recently by UAE Ambassador to Bangladesh Abdullah Ali AlHamoudi, during a meeting with Aninda Islam Amit, State Minister for Power, Energy and Mineral Resources. During the meeting, both sides discussed a number of issues of mutual interest.

the state minister said the UAE has historically been one of Bangladesh’s major and reliable sources of crude oil and petroleum product imports. He reiterated the importance of bringing these supplies under a ‘Bangladesh First’ policy framework to help the country withstand global fuel price hikes and sudden market shocks.

the UAE ambassador reaf?rmed his government’s interest in the development and expansion of Bangladesh’s power and energy sectors and assured all forms of cooperation.

India’s leading renewable energy company, Adani Green Energy Limited (AGEL), has commissioned a 3,370 MWh Battery Energy Storage System (BESS), making it the world’s second-largest battery storage network and the largest single-location battery storage project outside China.

the battery system, located at AGEL’s Khavda renewable energy park in Gujarat, will be charged using solar power and can deliver 3,370 MW of electricity for one hour, even when solar generation is unavailable. The stored energy is suf?cient to power nearly one million homes for a day or keep more than 12 million LED bulbs illuminated for 10 hours.

the project combines AGEL’s previously operational 2,000 MWh battery storage facility with a newly commissioned 1,370 MWh system, bringing the total storage capacity to 3,370 MWh. The company completed the expansion in just 10 months, setting a new benchmark for utility-scale battery deployment. Battery storage is increasingly becoming a critical component of renewable energy systems worldwide, enabling solar power generated during the day to be used at night and improving grid stability.

Bangladesh has underscored migration as an important climate adaptation strategy for addressing the growing challenges of climateinduced displacement, while calling for stronger international cooperation to enhance resilience and protect human dignity.

the issue was highlighted during a recent meeting between Bangladesh Ambassador and Permanent Representative to the United Nations Of?ce in Geneva, Nahida Sobhan, and Amy Pope, Director General of the International Organization for Migration (IOM). The discussions focused on the interconnected challenges of climate change, migration, and sustainable development. Climateinduced displacement continues to be a major driver of human mobility, particularly in countries that are highly vulnerable to the impacts of climate change. Bangladesh emphasized that well-managed migration can serve as a practical and effective adaptation measure, helping affected communities build resilience and access new opportunities.

The UN General Assembly (UNGA) has adopted a resolution to follow up on the landmark 2025 advisory opinion of the International Court of Justice (ICJ), reinforcing countries’ responsibilities to address climate change and protect human rights.

the resolution recognizes the ICJ opinion as an authoritative interpretation of international law and calls on all countries to safeguard the climate system and the environment from human-induced greenhouse gas emissions by preventing signi?cant harm, cooperating in good faith and protecting vulnerable populations. Introduced by Vanuatu and a group of supporting nations, the resolution was approved by a vote of 141 in favor, with eight countries voting against and 28 abstaining.

the General Assembly also requested the UN SecretaryGeneral to prepare a report in 2027 outlining ways to strengthen compliance and decided to revisit the issue during its 83rd session in 2028.

The Bangladesh Energy Regulatory Commission (BERC) has reduced jet fuel prices once again, marking the second price cut within two weeks in line with international market trends.

under the revised rates announced on Sunday, the price of jet fuel for domestic ?ights has been reduced by nearly Tk 15 per liter, from Tk 165.88 to Tk 150.21 per liter. For international ?ights, the price has been lowered from US$1.08 to US$0.98 per liter, according to the BERC noti?cation.

the new rates will come into effect from midnight and remain valid until further notice.

this follows an earlier reduction announced on May 23, re?ecting continued adjustments to global fuel price movements

The government has reappointed Engineer Md. Rezaul Karim as Chairman of the Bangladesh Power Development Board (BPDB) on a contractual basis for another year.

a noti?cation to this effect was issued recently by the Contract and Foreign Recruitment Wing of the Ministry of Public Administration.

according to the noti?cation, the appointment has been made under Section 49 of the Government Service Act, 2018. His postretirement leave (PRL) and related bene?ts will remain suspended during the oneyear contractual tenure, effective from the date of joining. Rezaul Karim is currently serving as the Chairman of BPDB. He assumed the role as the organization’s 39th chairman on September 1, 2024. Before taking charge as chairman, he served as a Member (Distribution) of BPDB and held several key positions within the country’s power sector.