Prime Minster Sheikh Hasina's visit to the Energy Ministry on the 24th day of her assumption of power, for the first successive time, underscores the importance the government is giving to the sector. Of particular importance is off-shore drilling as this is being dubbed as the next "trillion" dollar industry, globally. Already most countries of the world have exhausted their potential for on-shore explorations and therefore the new oil rush. Also the discovery of huge deposits of oil and gas in the North Sea in 1965 and later, has inspired people to believe that the off-shore holds huge untapped reserves. The prolific Gabbar oil field of Saudi Arabia, considered to be the world's largest, is also off-shore.
The urgency of offshore is urgent for us because on one side of our border lies Burma, where oil was first discovered in the world, as early as the late 18th century, by the Dutch oil company - also the world's first oil company - Burmah Shell, from where it drew its name. Naturally, Burma has developed the expertise for developing its oil concessions and has the right policies in place. On the other side, we have India, an energy-hungry country that has bought oil fields, along with the Chinese, as far away as Syria, to boost its energy security. Also, strange as it may sound, petro-chemicals are the largest single export of India. Consequently, India will need increased sources of energy not only to fuel its domestic economy but also for exports.
Already, we have demarcated the maritime boundary with Burma. And results from a similar arbitration with India are expected in June, this year. This will obviously pave the way for greater exploration in the Bay of Bengal and beyond. But then, it will need more than sovereign rights to ensure optimum output. Burma has already struck three gas deposits in its littoral Exclusive Economic Zone (EEZ), while India has also struck a similar number, one of them being, deep in the sea, near what may very well be the Bangladesh maritime border, very soon. Both the countries started exploring the sea long after the discovery of the Sanghu gas field but since then we have not been able to move forward. But others, inspired by our success have done much better.
What is the key to success? Obviously one has to have the right policy framework and institutions in place for harnessing its mineral resources. Evidently, we have proved to be poor in this sector, even as compared to our neighbours. That way, we will have a lot of problems coming our way in the days to come. As it is, we have a number of common deposits and mines with India which we have failed to exploit, amicably.
We are yet to have a proper framework for an effective energy policy regime, which assumes the most efficient tenure system and an "unbundling" of the sector. To date, we have failed in both, although documents for the latter are awaiting cabinet approval since 1998! It's time we acted on it.