Total, the French oil giant, is set to acquire 60 per cent stake of the Tullow's off-shore gas blocks 17 and 18 in Bangladesh.
"It is good that one of the world renowned oil and gas companies is getting itself involved in the country's energy sector to explore oil and gas," Energy and Mineral Resources Division (EMRD) Adviser Mahmudur Rahman told the FE Tuesday.
He said the Total's entry indicates the presence of a significant amount of gas reserve in off-shore areas of Bangladesh.
Currently Total, ranked as the world's fourth largest oil company, is involved in oil and gas exploration operations in more than 130 countries across the world.
It has the biggest market capitalisation in Europe worth 102 billion as on December 31, 2004.
EMRD sources said the acquisition of Tullow's stake by Total will be placed in today's (Wednesday) board meeting of Petrobangla for final approval.
Tullow will hand over formally the proposed stakes to Total following approval from Petrobangla, company sources said.
EMRD sources said both the parties have already completed negotiations with Tullow regarding acquisition of assets and liabilities in theses blocks that cover 13,724 sq km and lie south to the Sangu gas field near Cox's Bazar.
The acquisition will leave Tullow with 32 per cent stakes, Oakland of the United States 8.0 per cent stakes and Total with the remaining 60 per cent stakes.
The inclusion of Total will bring financial and technical strength to carry out substantial exploration works in these blocks, Tullow sources said.
The blocks were originally awarded in 1997 to the US joint venture Oakland-Rexwood, which was selected through the first round of bidding in 1993-94. Rexwood merged with Oakland later on.
Tullow purchased the lion's share of the blocks 17 and 18 from Oakland a few years back.
Sources said, Tullow has so far conducted seismic survey in the blocks and invested $7.0 million.
Tullow has also got clearance from the Department of Environment for carrying out seismic survey near the ecologically sensitive St Martin's Island under the block areas, they added.
If Petrobangla approves the survey plans, the company will carry out the survey between November 2006 and April 2007, said an official.
The company also plans to carry out three-dimensional survey over 1,000 square kilometres of area investing $30 million in two to three years.
EMRD sources said there is a prospect of gas reserve of several trillion cubic feet, as the neighbouring Myanmar's gas blocks are located along the same as blocks 17 and 18.
Tullow became involved in oil and gas exploration activities in Bangladesh in 1997 when it took a majority interest in the mainly offshore Blocks 17 and 18, in the Bay of Bengal.