Bahrain kicks off bidding for deep gas exploration

The bidding round for exploration of Bahrain's onshore natural gas fields launched today in an attempt to meet rising domestic demand.

Bahrain launched the bidding round for exploration of its onshore natural gas fields at up to 20,000 feet (6,096 metres) below sea level today, which it wants to develop to meet rising domestic demand. "The response has been very positive, 25 international companies came today and many more called and expressed interest," the oil minister and chairman of the country's National Oil and Gas Authority, Abdul-Hussain Ali Mirza, said during the official launching ceremony.

Bahrain consumed 1.3 billion cubic feet per day in 2007, Mirza said. He added that he expects consumption to grow to over two billion cubic feet per day in the long term. The data room for interested exploration companies will be opened in Jan or Feb 2009. Mirza said the open bidding process will end in the second quarter of 2009. Bahrain has also signed a framework agreement with Iran to import 1 billion cubic feet of natural gas per day.

Mirza said negotiations so far had been going smoothly. "The next stage will be the pricing, and that part will be the difficult one, obviously." Bahrain is a small oil producer. Its onshore Awali oilfield produces 35,000 barrels per day (bpd), while the country also receives around 150,000 bdp from Saudi Arabia, its share of output from the Abu Saafa oilfield. * Reuters