The International Centre for Settlement of Investment Disputes (ICSID) has directed the Canadian company Niko Resources to pay $ US 42 million as compensation for the blowout in Tangratila Gas field at Chhatak in Sylhet on January 7, 2005.
Bangladesh claimed over US$1.05 billion as compensation from the Canadian company Niko Resources for burning the country's gas reserves at Chattak Gas Field in Sunamganj on January 5 and June 24 in 2005 due to negligence.
Petrobangla Chairman Rezaur Rahman confirmed the ICSID’s verdict over the dispute on Thursday.
Niko was appointed by state-owned Petrobangla as developer of the Tangratila gas filed in joint venture with state-owned Bapex in 2003.
During the exploration drilling, the gas field blew out twice causing a huge damage to the field.
Since then, the activities of the field remained suspended while a case was also filed against Niko with a local court.
But Niko moved the ICSID to get a relief from its responsibility for blowout in the gas field.
Through this verdict, ICSID held the Niko responsible for the blowout.
On February 28, 2020, Bangladesh has won the case filed with the ICSID against Canadian company Niko Resources, which was the first part of the claim to established in the international court that Niko was responsible for the blowout.
Later, Bangladesh submit additional loss-claim for the damage to environment and the health of people living in the gas filed area. Expert team ascertained the losses to the environment of the area and the health of people.
On Thursday, January 29, 2026 Bangladesh won the second part of the case, establishing its claimed on "Losa ans Damage."
According to Petrobangla Chairman Rezaur Rahman, Niko to pay $US 42 million for burning about 8 billion cubic feet of gas of the Gas filed and to pay $US 2 million for the environmental damages of the gas field and surrounding areas.
Petrobangla has claimed the amount at the hearing that was conduct to identify 'Head of Loss' of Tengratila gas blowouts due to the damage caused to properties and gas reserves in and around the gas field.
"We placed all of our arguments and submitted papers supporting the claim before the ICSID. A seven-member panel from Bangladesh was took part in the 'Head of Loss' discussion that was administrated from Washington DC," a senior official of Petrobangla told the Daily Observer on Thursday.
Bangladesh, on the basis of reports from international experts, filed a claim for damages before ICSID in March 2016 seeking $118 million for Bapex and $896 million for Petrobangla and Bangladesh as compensation for the 2005 blowouts.
He said the discussion was focused on damages to the gas reservoir, damage of environment due to the gas blowouts and loss of the government for purchasing gas from other areas as it failed to tap the Tengratila gas.
Earlier, Petrobangla, the state-owned Oil and Gas Cooperation submitted the compensation claim to the ICSID against Canadian company Niko Resources for burning Bangladesh's gas reserve due to negligence.
ICSID found Niko liable for the two blowouts as the drillings was being carried out under its arrangements and supervision and it also ordered Niko to compensate the state-run Bangladesh Petroleum Exploration Company (Bapex) for the direct loss and damages caused by the blowouts.
"The tribunal said Niko was liable because of its failure to conduct operations diligently and in conformity with the standards of the international petroleum industry, compensation owed by Niko to Bapex includes the gas that escaped from of two gas blowouts in Chattak Gas field in Sunamganj on January 5 and June 24 in 2005," Petrobangla's lawyer Barrister Moin Ghani earlier told this correspondent.
In line with the ICSID verdict, Petrobangla submitted the memorial before the court to get final verdict from the tribunal.
Meanwhile, Bangladesh has engaged US-based law firm Foley Hoag LLP to assess the loss and damage issues of the blowouts.
