With dues cleared, govt urges Chevron to resume $65m Jalalabad gas project
Last year, Chevron halted project investment due to Petrobangla's nonpayment of over $200m in gas bills
After settling all pending gas bills, Bangladesh has urged Chevron to move forward with the previously scrapped gas compression project at the Jalalabad field in Sylhet, operated by the US oil and energy giant.
Petrobangla had taken the project to construct a natural gas compression in Jalalabad to boost gas production and Chevron assured of $65 million funding for this project.
However, on 4 April 2024, Chevron said it would not proceed with the project unless Petrobangla cleared all overdue gas bills, amounting to over $200 million at that time. The project remained on hold since then.
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On 21 April 2025 Petrobangla cleared its outstanding payments and a day earlier, on 20 April, it formally requested Chevron to resume work on the project.
When asked, AKM Mizanur Rahman, director (Finance) of Petrobangla, told TBS, "Chevron withheld the investment proposal because of our payment delay. We have cleared all bills and requested Chevron to start this project at the earliest possible time."
Earlier, Chevron estimated that, upon completion of the compression project, some 3,52,000 mmcf additional gas could be extracted from this gas field. The compression work was scheduled to be completed by 2025.
Sources from Chevron Bangladesh said the decision of withholding investment in the project was taken by the head office in Houston, Texas. Re-investment decisions will also be taken by the head office.
When TBS formally approached Chevron Bangladesh to ask whether it would invest in the compression project following the clearance of dues, Shaikh Jahidur Rahman, media and communications manager, said, "We greatly appreciate the efforts of the interim government, energy ministry, and Petrobangla to resolve this issue. This outcome sends a positive signal to existing and potential investors."
He also said, "We have been a partner in ensuring Bangladesh's energy security and driving economic progress for 30 years and look forward to continuing the journey together."
Chevron is the largest producer of natural gas in Bangladesh, with an average output of 1,050-1,100 mmcfd from its three onshore gas fields – Bibiyana, Jalalabad, and Moulavi Bazar.
As of 5 August 2024, Chevron's outstanding bill stood at $237.55 million, which was fully cleared on 21 April this year. In FY24, the Jalalabad gas field produced an average of 160.82 mmcfd.
