Cairn starts drilling offshore Bangladesh gas field

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DHAKA, Oct 6 (Reuters) British oil and gas firm Cairn Energy PLC has started drilling in a Bangladesh offshore gas field in the Bay of Bengal and expects to confirm any findings by the year-end, a top energy official said on Saturday.

The firm, which invested 7 million in the project, started drilling after completing 2D seismic surveys in an exploration well at the Magnama structure, about 60 kilometres (37.5 miles) south of the port city of Chittagong, the official said.

Cairn Energy officials confirmed that drilling had begun without elaborating.

''It will require 72 days to confirm if there is any reserve of natural gas in the new offshore field,'' the official from the Ministry of Power, Energy and Mineral Resources, said.

If they do not find any gas at Magnama, the drilling rig will be moved to the Hatiya structure, another offshore structure in the Bay of Bengal, to search for gas.

''We are eagerly waiting to hear the good news as Bangladesh is likely to face a gas shortage by 2011, when the current reserve of gas will be exhausted,'' the official said.

The gas reserve at Magnama and Hatiya offshore fields are estimated to be 3.5 trillion cubic feet (tcf) and 1.8 tcf respectively, ministry and industry officials said.

Cairn Energy is now operating Bangladesh's only offshore gas field at Sangu in the Bay of Bengal, off Chittagong port.

Cairn has been in Bangladesh for more than 10 years and, along with its joint venture partner, U.S. firm Halliburton, has so far invested nearly 0 million, officials said.

The firm presently produces up to 80 million cubic feet of gas per day from the Sangu field.

Bangladesh has 13.54 trillion cubic feet of proven and recoverable gas reserves.

REUTERS MP RS1527

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