Govt signs eight more petroleum concession, exploration licenses

50 blocks had been awarded on provisional basis to nine E&P companies last month.

ISLAMABAD: The government on Friday signed eight petroleum concession agreements, and eight exploration licenses for blocks in all four provinces.

The ministry of petroleum and natural resources, after taking all provinces on board in finalising the model petroleum concession agreement (MPCA) and model exploration licence (MEL), had awarded 50 blocks on provisional basis to nine E&P companies last month. Of these 21 blocks are in Balochistan, 15 in Punjab, six in Sindh and eight blocks in Khyber-Pakhtunkhwa. The ministry has already signed (20) ELs and PCAs in February, 2014.

On Friday the government executed eight more petroleum concession agreements (PCAs) and eight exploration licences (ELs) over blocks 2867-5 (Kuhan) and 2866-4 (Margand) with OMV (Pakistan) Exploration Gesellschaft mbH (OMV) and Pakistan Petroleum Limited (PPL). Blocks 3369-1 (Orakzai), 3170-7 (Hetu) and 2868-7 (Zorgarh) with Oil & Gas Development Company Limited (OGDCL), block 2569-5 (Khipro East) with PPL, blocks 3169-4 (Baska North) and 3271-6 (Potwar South) with Al-Haj Enterprises (Pvt) Ltd (AL-Haj). The Kuhan block will be operated by OMV while Margand block will be operated by PPL.

Orakzai block is located in Kurram Agency, Orakzai Agency and Hungo district of Khyber Pakhtunkhwa, Hetu block is located in Bhakkar and Mianwali districts of Punjab  and DI Khan district of KPK, Zorgarh block  is located in Ghotki, Kashmore districts of Sindh, Dera Bugti and Jaffarabad districts of Balochistan and Rajanpur district of  Punjab, Margand block is located in Khuzdar district of Balochistan and Dadu district of Sindh, Khipro East block is located in Sanghar and Umer Kot districts of Sindh, Kuhan block is located in Khuzdar, Jhal Magsi, Bolan and Kallat districts of Balochistan, Baska North block is located in DI Khan and  Tank districts of KPK, Zhob district of Balochistan and South Waziristan Agency and Potwar

South block is located in Chakwal, Khushab and Mianwali districts of Punjab. The total area of aforesaid blocks is 18,852.64 Sq. Km and minimum firm work commitment is $60.73 Million.

The government claims that 73 wells have been spuded and 18 discoveries have been made since June last year raising oil production in the country over 90,000 barrels per day.

Apart from minimum work commitment, companies are obligated to spend a minimum of $30,000 per year in each block.

Al-Haj is the new Local E & P company, while OGDCL is a Public Limited Company engaged in Exploration & Production activities in the country for the last four decades. OGDCL holds the largest share of Oil (58%) & Gas (42%) of the total reserves in the country. Its percentage share of total oil & gas production in Pakistan is 52% and 27%, respectively. In addition, OGDCL is the operator in 45 exploration licences and working interest owner in six other exploration blocks operated by various E & P companies. OGDCL is currently producing 44,584 barrels of Oil, 1181 MMCF of gas, 84 metric tons of LPG and 96 metric tons of Sulphur per day.

PPL is the operator of 24 different exploration blocks and working interest owner in 16 other exploration blocks operated by various E & P companies. PPL operates six producing fields including Sui, Kandhkhot, Mazarani, Adam, Adhi and Chachar with the total daily production of 665 MMCF of gas, 6,640 barrels oil and 162 metric tons of LPG.

The execution ceremony was attended by Minister for Petroleum & Natural Resources Shahid Khaqan Abbasi, State Minister for Petroleum & NR Jam Kamal Khan, and Advisor to Ministry of  Petroleum & Natural Resources Zahid Muzaffar.

Respective ELs and PCAs were signed by Secretary Petroleum and Natural Resources Abid Saeed, Director General Petroleum Concessions Saeedullah Shah, Senior Vice President of Middle East and Caspian Region, OMV Erwin Kroll, Managing Director, OGDCL Riaz Khan, Managing Director, PPL Asim Murtaza, and Chief Executive Officer, Al-Haj Taj Muhammad Afridi. Directors from concerned Provinces were also present.