Petrobangla has moved to drill two new wells at the Titas gas field to add an estimated 30 million cubic feet of gas per day (mmcfd) to the national grid, as the government steps up efforts to boost domestic production and reduce dependence on costly liquefied natural gas (LNG) imports.
The Planning Commission has completed its scrutiny of a Tk 592 crore project and is set to place it before the next meeting of the Executive Committee of the National Economic Council (ECNEC) for approval.
The project, titled Drilling of Two Appraisal-cum-Development Wells (Titas-32 and Titas-33) in Titas Gas Field, will be implemented by Bangladesh Gas Fields Company Limited (BGFCL), a Petrobangla subsidiary, from October 2026 to September 2029.
The wells will be drilled in Brahmanbaria Sadar upazila and are expected to supply gas primarily to fertiliser and power plants, helping meet domestic energy demand.
The project cost has been reduced by Tk 40 crore from the original estimate of Tk 632 crore following a review of the proposed expenditures.
The initiative is part of the government’s plan to drill 150 wells to increase domestic gas production and reduce the country’s reliance on imported LNG.
Titas remains a key gas source
BGFCL, the country’s largest state-owned gas producer, supplies around 480–485 mmcfd of gas to the national grid from five of its six gas fields.
Titas is the company’s largest producing field. Of the 28 wells drilled there, 23 are currently producing around 330 mmcfd, according to project documents.
A review of three-dimensional seismic surveys conducted between 2010 and 2012 by BGP Inc., a unit of China National Petroleum Corporation, recommended drilling 16 infill wells and one deep well at the field.
Titas-32 and Titas-33 have been prioritised under the government’s domestic gas development programme.
The two wells are expected to produce around 30 mmcfd of gas and 18 barrels of condensate per day. Over a 10-year period, their projected output is estimated at 100.74 billion cubic feet of gas and 60,884 barrels of condensate.
Government to provide Tk 414cr
Of the revised project cost of Tk 592 crore, the government will provide Tk 414.40 crore as a loan, while BGFCL will contribute Tk 177.60 crore from its own resources.
The proposed expenditure is Tk 1.20 crore in fiscal year 2026–27, Tk 95 crore in 2027–28, Tk 290 crore in 2028–29 and Tk 205.80 crore in 2029–30.
Most of the work will be carried out by a foreign contractor under an integrated drilling arrangement covering drilling materials, third-party engineering services and rig foundation construction.
The project documents estimate the value of the gas and condensate output at Tk 339.07 crore at wellhead prices over 10 years. At consumer-level gas prices, the gas alone is valued at approximately Tk 6,523.97 crore.
A 2026 feasibility study by the Infrastructure Investment Facilitation Company estimated the project’s financial internal rate of return at around 56% and its financial net present value at Tk 2,281 crore, using a 12% discount rate.
How the project cost was cut
BGFCL’s original proposal, received on April 21, sought Tk 632 crore. The Project Evaluation Committee (PEC), at a meeting on June 18, found several expenditure items inflated and reduced the proposed cost by Tk 40 crore.
The largest savings came from contingency allocations. Physical contingency was reduced by Tk 5.69 crore, while price contingency was cut by Tk 22.11 crore.
The PEC also reviewed BGFCL’s proposal to hire three categories of foreign consultants, allowing two foreign consultants and one local consultant instead.
It halved the vehicle-hiring budget by approving one vehicle instead of two. The provision was for hiring, not purchasing, vehicles.
Allocations for insurance, telephone, travel and warehouse repairs were removed. Several construction items, including a chemical store, an Ansar camp, a security post, a village road and culverts, were also dropped. Some of these facilities are to be developed later using BGFCL’s own development budget.
One cost item increased. The depreciation of the taka against the US dollar, from Tk 122.75 to Tk 123.75 per dollar, added Tk 3.50 crore to the cost of hiring drilling equipment.
BGFCL submitted the revised project proposal on September 6, incorporating detailed drawings, cost breakdowns and an environmental clearance certificate. The Planning Commission said the revised proposal complied with the PEC’s decisions.
Planning Commission officials said the project aligns with the government’s election pledge to increase domestic gas production, the Five Year Strategic Framework for Reform and Development (2027–2031), and Sustainable Development Goal 7, which focuses on affordable and reliable energy.
“Once the project is implemented, two new wells of Titas gas field will supply an additional 30mmcfd natural gas to the national grid, which will help flourish local industries and at the same time save foreign currency by cutting LNG imports,” said Nurunnahar Chowdhury, former member (secretary) of the Industry and Energy Division.