ISLAMABAD: The government awarded four oil and gas exploration blocks in Balochistan to three major exploration and production (E&P) companies on Tuesday, with an aim to expedite the search for hydrocarbon deposits and lesson import burden.
The awarded companies include Mari Petroleum Company Limited (MPCL), Pakistan Petroleum Limited (PPL), and Oil and Gas Development Company Limited (OGDCL).
It is to be noted that energy-hungry Pakistan is facing a growing energy demand. A major portion of the country’s energy demand is met through imported fossil fuels.
The country spends multi-billion dollars each year on its imports to power its economy.
In FY22, petroleum group imports increased by 105 percent to a historic high of $23.3 billion from $11.36 billion in FY21.
In their respective stock filings, the companies on Tuesday reported to the Pakistan Stock Exchange that they had been awarded the blocks by the ministry of Energy’s Directorate General of Petroleum Concessions (DGPC).
“The Government of Pakistan has provisionally awarded four new blocks (Shaigalu, South Pishin, Tanishpa, and Lugai) to joint ventures of PPL, OGDCL, and MPCL,” PPL said in its notice.
Of the blocks, OGDCL will be the operator of two blocks including Tanishpa and Lugai, while PPL will operate the Shaigalu block and MPCL South Pishin block.
In the South Pishin block, MPCL will hold 37 percent stakes, PPL 35 percent, and OGDCL 28 percent.
Similarly, in the Shaigalu block, PPL share would be 40 percent, MPCL and OGDCL 30 percent each.
In the Tanishpa block, OGDCL stakes would be 37 percent, MPCL 28 percent, and PPL 35 percent.
Likewise, the Lugai block has OGDCL’s stakes of 40 percent and PPL and MPCL with 30 percent each.
MPCL in a separate filing said that the blocks had been awarded after competitive bidding on the basis of work units committed by various E&P companies in the Pakistan E&P bid round 2022 (October) conducted by DGPC.
The formal award of petroleum rights in the blocks is conditional to the signing of petroleum exploration licenses and execution of petroleum concession agreements with the government, execution of joint operating agreements among the respective joint ventures, and completion of related legal/procedural formalities.
MPCL further said that the likely acquisition of the new exploration blocks was in accordance with its exploration business plan aimed at expanding its exploration acreage for adding new resources to the company’s hydrocarbon resource balance.