The country will soon adopt its first ever Gas Sector Master Plan (GSMP) that outlines policies on exploration, production and pricing.
"The draft of the 25-year GSMP has already been finalised and it now awaits approval of the Energy and Mineral Resources Division (EMRD)," a top official of the EMRD told the FE.
He said the EMRD is now reviewing the draft GSMP. The EMRD is taking comments from energy experts aiming to make the plan time-bound and appropriate, he added.
The World Bank (WB) has financed the drafting of the GSMP. The draft GSMP has projected the present gas reserve to go dry by 2015 if no new gas discovery is made.
To maintain an uninterrupted supply of natural gas to the consumers the government must have to discover new gas reserve of at least 20 trillion cubic feet (TCF) by 2010, the proposed GSMP pointed out.
The sector will require investment worth nearly US$ 8.0 billion by the next five years to develop existing gas fields and discover new ones.
On future gas prices, the draft GSMP suggested that the domestic gas prices should be raised to a level equivalent to the petroleum price of $ 50 a barrel by 2010 to make it compatible with the international gas market.
Currently, domestic gas price in Bangladesh is $ 1.4 per 1,000 cubic feet on an average, which is equivalent to the petroleum price of $ 10 a barrel in the international market.
The draft GSMP recommended that the gas price needed to be increased on yearly basis starting from this year.
The government should raise the domestic gas price to $3.7 per 1,000 cubic feet this year, $4.5 in 2007 and accordingly reach $7.4 in 2010.
EMRD sources said the draft GSMP has been prepared to match with the existing 20-year Power Sector Master Plan (PSMP).
The country's parent gas company - Petrobangla - said natural gas accounts for 70 per cent of energy consumption.
Natural gas is mostly used as fuel for generating electric power and producing chemical fertiliser.
Besides, gas is also being used in running vehicles, burning bricks and manufacturing industrial products.
The country's 90 per cent of the existing power plants are gas-based, a senior Petrobangla official said.
"Due to absence of GSMP most of the gas projects are being carried out on the basis of project concept paper (PCP), which delays the implementation," he said.
The government has, however, taken initiative to frame the gas sector master plan 51 years after the first discovery of gas field in Sylhet in 1955, Petrobangla officials said.
Two rounds of international bidding have already taken place without the master plan for gas sector in Bangladesh.
Eight production-sharing contracts (PSCs) with the international oil and gas companies (IOCs) have already been signed for 10 blocks across the country.
Now the government is planning to float tender for third round bidding for deep-water hydrocarbon exploration in the Bay of Bengal.
Besides, Bangladesh has over 138 drilling wells, 70 exploration wells, 68 appraisal wells.
A total of 23 gas fields and one oil field have so far been discovered during last half a century.
It had initial recoverable gas of 20.51 TCF, which now reduced to 14.88 TCF after consumption of 5.63 TCF.
The country's gas production capacity is now 1550 million cubic feet per day (mmcfd).