GAS WELL EXPLOSION

UNCLAS DHAKA 000130 SIPDIS E.O. 12958: N/A TAGS: ECON ENRG EINV BG SUBJECT: GAS WELL EXPLOSION ¶1. A gas field explosion in Sunamganj forced 10,000 people from their homes on January 8th, sparking widespread media and government speculation as to the cause and extent of the damages. Newspapers reported losses in millions of dollars and speculated that the fire would continue for 30 to 45 days. Experts feared that a new rig would have to be brought to control the fire, delaying the process by 30 days. ¶2. According to initial reports, the explosion destroyed the oil rig and the well remained inaccessible by operators. To control the fire, Niko, the Canada-based manager of the gas field, contemplated drilling sideways, 500 meters from the well, to relieve pressure on the well. However, the well proved to be low in gas, and the fire burned itself out the following day. ¶3. A Chinese subcontractor, CPTDC, operated the rig. The explosion destroyed the rig and caused more than $25 million in operational losses to Niko and the subcontractor, according to press reports. Niko may also have to bear the additional cost of rebuilding more than 40 homes that were destroyed by the explosion. Senior officials from the Energy Ministry and Petrobangla visited the site and announced plans to set up an inquiry committee. Press reports, perhaps drawing on BDG officials have already blamed Niko "mismanagement" and alledgedly flawed technology for the blowout. THOMAS