Bangladesh has asked US oil giant Unocal for $685m in damages for the loss of natural gas in a devastating 1997 fire.

Petrobangla, the state-owned oil and gas company, wants compensation for the loss of 7.4 billion cubic metres of gas.

But Unocal spokesman Scott Barber told The Independent newspaper: "The Magurchara [gas field] issue is no more. We resolved it four years ago.

"Unocal is in the clear."

The fire at Magurchara in the north-eastern Sylhet district burnt for several weeks in 1997 and caused extensive damage to the gas field and surrounding tea gardens and forests.

Unocal operations

A parliamentary committee found Unocal "negligent" in its management of the field.

The gas field was formerly operated by US company Occidental, which was named as a reference in the case.

Unocal began operations in Bangladesh in 1974 with a joint-venture to develop an offshore gas field, but returned its licence in 1978 due to lack of demand.

It returned to Bangladesh in 1996 through a joint venture in north-eastern Bangladesh with Occidental, which it fully acquired in 1999.