OGDCL makes oil and gas discovery in Sindh

Barely three days after it conveyed the discovery of oil and gas reserves from its exploratory well in Sindh, has Oil and Gas Development Company Limited (OGDCL) announced similar development from its exploratory well located in Sindh also.

In a notice sent to the Pakistan Stock Exchange (PSX) on Thursday, the company, one of the largest oil and gas exploration companies in Pakistan, announced, “The Joint Venture of Sinjhoro Block comprising OGDCL as operator (76%), Orient Petroleum (19%) and Government Holdings (GHPL) (5%) has discovered oil and gas from an exploratory well namely Kot Nawab-1 which is located in District Sanghar, Sindh Province”.

The oil and gas exploration company said Kot Nawab-1 was spudded-in on June 03, 2022 as an exploratory well by using OGDCL's in-house expertise.

“The well was drilled down to 3,000 meters. Based on the results of wireline logs interpretation, Drill Stem Test-1 in the Basal Sand has tested 125 barrels of oil per day (bopd) and 0.483 million standard cubic feet per day (mmscfd) gas and 400 barrels of water per day (bwpd) through choke size 28/64 at well head flowing pressure (whfp) of 150 pounds per square inch (psi),” read the notice.

The said development is the eleventh discovery in Sinjhoro Block, said OGDCL, which shows the commitment of Sinjhoro JV to exploit the hydrocarbon (HC) potential of the block and aggressive exploration strategy.

“It has opened a new avenue and will positively contribute to mitigating energy demand and supply gap from indigenous resources and will add to the hydrocarbon reserves base of OGDCL and the country,” said the Company announcement.

The discovery comes as Pakistan faces an energy crunch, as its reserves continue to deplete, while the country struggles to obtain fuel cargoes.

Just days ago, OGDCL had announced the discovery of oil and gas from its development cum exploratory well namely Chak-5 Dim South-3, which is also located in District Sanghar, Sindh.

 

OGDC: Takeaways from FY22 Analyst Briefing

Pakistan’s largest exploration and production company; Oil & Gas Development Company Limited (OGDCL), held its analyst briefing earlier, wherein the following was discussed:

The Company has posted the highest quarterly profit after tax of PKR53.3 billion (EPS: PKR12.4) for 1QFY23, higher by 145%QoQ and 58.5%YoY basis.

Major projects during the year were: Discovery in Wali block with cumulative potential of 219bcf gas and 13 million bbl oil and exploration and appraisal activities at Abu-Dhabi offshore block 5.

Other developments during the year included: company entering into a framework agreement with the Government of Pakistan, provincial government of Baluchistan, GHPL, PPL and Barrick Gold Corporation for extraction of gold and copper reserves from Reko Diq.

As per company presentation, OGDCL holds 87,300 square km of exploration coverage with total of 57/111 exploration/development licenses, respectively.

Province wise concession shares are: KPK 19%, Sindh 21%, Punjab 21% and 39% Baluchistan.

Seismic survey acquisition during the last six fiscal years was 15,380 Line km of 2D and 3,766 sq. km of 3D portraying.

OGDCL’s share in total industry stood at 80% 2D and 31%3D surveys. Finally, OGDCL’s share in gross production works out at 23%, with industry’s total production at 73,400 bpd as on June 2022.

According to management, average natural decline rate of major oil fields stands at 16% (5-year average). Although, the said decline rate has been arrested to 6-8% more recently with the help of workovers and development wells etc.

Industry’s net gas production stood at 3,390mmcfd (OGDCL share 29%) during FY22. Natural depletion rate stands at 8% for major fields (Mela, Nashpa, Kunnar Pasakhi Deep etc.), but has been arrested at 5% by the company through workovers and development wells etc.

Management stated that Reko Diq project is a stepping stone for the diversification strategy company is trying to achieve. Company is also trying to move into power and other energy projects as well.