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US nudged Bangladesh to allocate gas blocks

BS Reporter / New Delhi December 25, 2010, 0:15 IST

Every time India would ask Bangladesh for rights to explore gas, Dhaka would say the country had to first find if there was gas available at offshore locations. For the last one year, the issue hasn?t even been mentioned in discussions with Bangladesh, top petroleum ministry officials said. But India?s loss has been the US gain and it managed to walk away with the prize.
WikiLeaks tapes released late last night revealed how US-based ConocoPhillips was selected from a field of seven bidders and awarded two offshore blocks for exploring gas in 2009. The company was awarded a production sharing contract, with a provision to export the gas in the form of liquefied natural gas in the untapped areas of the Bay of Bengal. The bidders had agreed to stay away from disputed waters in the Bay of Bengal, something US Ambassador to Bangladesh, James Moriarty mentioned in his cables sent in July 2009. Conoco got the contract in October 2009.
Moriarty met Bangladesh Prime Minister Hasina Wajed?s energy adviser, Tawfiq Elahi Chowdhury, and got him to assure that ConocoPhillips would be awarded two of the uncontested blocks and Chevron given permission to go ahead with the first of the three compressors necessary to improve flow in Bangladesh?s main gas pipeline. Within three months, the Bangladesh government complied.
Defending themselves against the charge that they had allowed the US to have an advantage by not being proactive themselves, Indian Petroleum Ministry officials said Indian finds of gas had reduced the pressure to secure gas from Bangladesh.
WikiLeaks tapes also revealed that Moriarty urged Chowdhury to approve plans by British company Global Coal Management (GCM) to begin open-cast coal mining in the country?s Phulbari area. In the cable, Moriarty quoted Chowdhury saying the coal mine was ?politically sensitive in the light of the impoverished, historically oppressed tribal community residing on the land?.
The energy advisor, however, agreed to build support for the project through the parliamentary process, Moriarty said in the cable.
In a cable posted by WikiLeaks that was sent in July last year, Moriarty said he had urged Chowdhury to authorise coal mining, adding ?open-pit mining seemed the best way forward?. Later on in the cable, Moriarty said, ?Asia Energy, the company behind the Phulbari project, has 60 per cent US investment. Asia Energy officials told the ambassador they were cautiously optimistic that the project would win government approval in the coming months.?
The ?Phulbari killings? as they are known took the lives of three boys in 2006 when police fired at a demonstration near the mine site. Asia Energy?s shares had crashed in the international market as a result and the company had to undergo a brand change, including a name changing.
In the WikiLeaks cables, Moriarty?s conversations with Indian ambassador Pinaki Ranjan Chakravatry, by contrast, revealed no discussions of a commercial nature, only a general approval by India of the change in government in Bangladesh and US endorsement of a joint South Asian task force on counterterrorism.
India?s high commissioner in Dhaka obligingly told the US ambassador that while India would ?prefer a primarily bilateral engagement?, Bangladesh might want a regional force for political reasons ? allegations that she was too close to India.
Chakravarty spoke of Bangladesh?s keenness to ?invest heavily in Bangladesh?s moribund railway system? including reconnecting the Bangladeshi railroad system to Agartala in Tripura. He said Indian companies would be interested in setting up power plants in Bangladesh, though the price of electricity ?is still under negotiation?. The US takeaway from the conversation is that regional counter-terrorism cooperation would help US assets enormously. Much of the rest is yet to become a reality