Bangladesh has secured a historic legal victory in its two-decade-long battle against Canadian energy firm Niko Resources.

The Washington-based International Centre for Settlement of Investment Disputes (ICSID) has ordered the multinational company to pay USD 42 million (approximately BDT 516 crore) in compensation for the catastrophic gas field blowouts that occurred in Chhatak, Sunamganj, in 2005.

The tribunal’s final verdict, confirmed by Petrobangla Chairman Engineer Rezanur Rahman, concluded that the two explosions on January 7 and June 24, 2005, were the direct result of Niko’s operational mismanagement and failure to adhere to international petroleum industry standards.

The disaster led to the burning of an estimated eight billion cubic feet of natural gas and caused severe, long-lasting environmental damage to the surrounding region.

While Bangladesh had originally claimed nearly USD 1 billion in total damages, the tribunal’s award specifically covers the value of the lost gas and immediate environmental restoration costs.

This ruling concludes a complex legal saga that began in 2003 when Niko was tasked with exploring the Tengratila field. Following the company’s initial refusal to pay damages, the matter moved to international arbitration in 2016.

With the compensation now officially mandated, Petrobangla has announced plans to move forward with the redevelopment of the Chhatak gas field.

A Development Project Proposal (DPP) for drilling new wells is already in preparation, and officials are consulting with the Attorney General’s Office to finalize the recovery process and restore production at the site.