Another oil and gas discovery in Pakistan

One of Pakistan leading oil and gas exploration and production company, Mari Petroleum Company Limited announced has struck another significant crude oil, condensate and natural gas discovery at Kalabagh well located in Karak block of Mianwali district, Punjab.

This joint venture in Karak is operated by Mari Petroleum with a 60% working interest and MOL having a 40% share. The discovery at Kalabagh-1A ST1 is the second for the company in the block in Datta, Samanasuk and Lockhart formations. Earlier, it made a major crude oil discovery in the block at Halini well-I in 2011.

During testing at Kalabagh well, gas and condensate flowed in the Datta formation at a rate of 3.3 million cubic feet per day (mmscfd) and 160 barrels per day respectively.

The well was also successfully tested in the Samanasuk formation where gas and condensate flowed at a rate of 4.68 mmscfd and 180 barrels per day. In the Lockhart formation, crude oil flowed at a rate of 500 barrels per day.

Additionally, the company is drilling third exploratory well Halini Deep-I in the block, which is currently at the depth of 5,669 meters and is amongst the very few wells being drilled down to such deep depth.

 

Russia enters Pakistan in search of oil and gas

Russia is expected to soon return to Pakistan’s petroleum sector after five decades with fresh investment commitments in new exploration and development techniques and construction of cross-country pipelines.

While the two countries are at an advanced stage of talks on a government-to-government contract of a 1,100-kilometre gas pipeline from Karachi to Lahore with an estimated cost of US$2.5 billion, some Russian companies are preparing to enter Pakistan’s exploration and development sector.

Reportedly a leading Russian petroleum company, JGC Rosgeologia (Rosgeo) has recently signed non-binding agreements with two public sector exploration and development companies for investment cooperation. The MoU was signed by KPOGCL’s CEO Raziuddin Razi and Rosgeo’s CEO Roman S. Panov. The two firms would promote the establishment and development of mutually beneficial cooperation in the above areas.

According to the MoU signed with Khyber Pakhtunkhwa Oil and Gas Company Ltd (KPOGCL), Rosgeo from Moscow will extend long-term cooperation in KP’s exploration and production (E&P) sector. The two firms would jointly bid for fresh exploration and concession blocks in upcoming transactions and acquire shareholding from existing companies.

The KPOGCL was created after the 18th Constitutional Amendment to share with federal government ownership of oil and gas rights. In 1961, Pakistan set up its largest E&P firm, the Oil and Gas Development Company Ltd (OGDCL), with the financial and technical support of the then USSR technical experts. The cooperation remained almost non-existent for decades due to diplomatic reasons.

The agreement envisages long-term cooperation between the two companies to perform various E&P activities, including geological and geophysical field works, 2D and 3D seismic data acquisition, drilling and related services, warehousing and jointly acquiring concession blocks in various parts of Pakistan.

Specific cooperation will be in the key priority areas of increasing the economic potential of Pakistan through the identification of new hydrocarbon fields and efficient use of the natural resources by ensuring environmental protection and sustainability.

The joint venture would also carry out geological surveys within Pakistan, using the modern technologies and methods. The Russian company will be responsible for the technical planning and execution, arrangement of rigs and recorders, while KPOGCL will be responsible for security, logistics and transportation, gensets, earth moving equipment, cranes, tractors, camp facilities, local support manning, communication, local clearances, permits, licences, business development, etc.

The cooperation of the two companies will be implemented in phases. A permanent working group comprising the two companies has been constituted to identify, study and evaluate specific projects of mutual interest.

For every specific project of mutual interest, the two companies would establish the appropriate scheme of cooperation and establish a joint company that will undertake the execution of the various projects.

Rosgeo also signed a similar MoU with the OGDCL for E&P cooperation on broader terms within their blocks for mutual benefit and overall reciprocity in accordance with the relevant laws, rules and regulations.

The cooperation under the MoU would include examining the possibility of “farm-in” and “farm-out” opportunities in existing exploration licences and look into opportunities in development and production fields including opportunities related to the application of enhanced oil recovery (EOR) techniques.

The two sides would look into mutually beneficial activities in acquisition, processing and interpretation of 2D and 3D seismic data and formulate strategies for sharing the expertise and training the personnel of both the companies.

Defending Pakistan's territorial integrity

It is heartening to note that this year 6^th September is being celebrated with great fervor. While most of Pakistanis thank All Mighty Allah for protecting Pakistan from external aggression, I was not amazed to read a comment “We had lost war in 1965”. One should not forget snicks have always prevailed, though in minority but they play the role of creating confusion and discontent.

By the grace of Allah I am more than 62 years old, witnessed 1965 and 1971 wars besides uncountable border firing cases. Let me reiterate that extremist Hindus have not accepted partition of subcontinent and are adamant at destroying Pakistan. The repeated assaults on Pakistan prove that these extremists have not been able to achieve their ultimate objective of eliminating Pakistan from the world map.

Having said that, it is also to be taken into account that in Pakistan various militant groups are busy in sabotage in the name of religious fanaticism, self-proclaimed discontent and target killing of religious scholars, academicians and social figures that raise voice against the terrorists and demand weeding out of these highly undesirable elements.

Being a student of geopolitics, who has been closely watching proxy wars being fought around the world, I can say without mincing words that the super powers create issues, assemble rebel groups, and provide those funds, arms and training. They also prepare hawks that spread disinformation and create hatred among people belonging to different religions and sects.

Pakistan has been fighting a proxy war in Afghanistan for more than four decades and has faced the worst fallout. Its social fabrics is torn, millions of militants are hibernating in Pakistan (they wear different caps) and using residents of areas as human shields. These culprits also enjoy support of local political, sectarian and linguistic group as they play the role of ‘militant groups’ of these outfits.

These are not Jihadist but hardcore criminal and blood thirsty people. They kill people for money and only for money. Their sanctuaries are located in Punjab, KP and Baluchistan provinces and keep coming to Sindh. One wonders what the people posted at various check points are doing to check and contain movement of these culprits.

Since 9/11 millions of people have been killed in Iraq, Afghanistan, Libya, Yemen, Syria, Sudan and Pakistan. Most of these countries do not suffer from any serious internal conflicts but those inculcated and groomed by super powers.

The apathy of super powers and support for the aggressor is evident from funding of ISIS to topple Asad in Syria, presence of biggest open air prison in Gaza, Palestine and Kashmir issues remaining unresolved for more than half a century.

Let every Pakistani stand up and help in weeding out the culprits. Keep a close watch at your surrounding and never allow any suspected to find a refuge in your locality. Develop interfaith harmony so that none can mislead you in the name of religion, Islam does not teach killing.

Crude Oil: Maker and spoiler of fortunes

I just can’t resist sharing this Bloomberg story with the readers of my blog. 

Oil is so much more than a fuel. It’s a force even bigger than its $3.4 trillion market. It’s a weapon, a strategic asset, a curse. It’s a maker and spoiler of fortunes, a leading indicator and an echo chamber. All these roles have a part in setting oil prices. The result is a peculiar market that says as much about global economics and politics as it does about supply and demand.

The Situation

After four years when the highest average oil prices in history seemed to defy economic gravity, petroleum fell in mid-2014. It had risen to $107.73 a barrel that June, even as Americans and Europeans drove fewer miles in more efficient cars, curbing consumption of gasoline, the biggest source of oil demand. Meanwhile, supply expanded as the sustained higher prices made techniques such as deep water drilling and fracking pay off. Those fundamentals started to register in the summer, as Chinese imports sagged, Europe teetered on the brink of recession, and the stronger U.S. economy made barrels priced in dollars relatively more expensive. Instead of stanching the glut by pumping less oil, Middle East exporters engaged in a price war to defend their market share. The price had dropped to $42.03 in March, the lowest since 2009, as U.S. storage tanks brimmed with oil. Then came a rebound above $50 a barrel after the conflict in Yemen. The price collapse had forced high-cost drillers in North Dakota and Texas to idle rigs while international giants like BP, Shell and Halliburton cut thousands of workers and billions of dollars in spending. Those developments led OPEC to declare its strategy a success at its June meeting and to maintain current production levels. With several members eager to increase their own production, Iran poised to ramp up exports after reaching a nuclear agreement with six world powers, and shale output proving surprisingly resilient as drillers cut costs and focused on the best terrain, the supply glut showed little sign of abating.

Crude Oil: Maker and spoiler of fortunes

I just can’t resist sharing this Bloomberg story with the readers of my blog. 

Oil is so much more than a fuel. It’s a force even bigger than its $3.4 trillion market. It’s a weapon, a strategic asset, a curse. It’s a maker and spoiler of fortunes, a leading indicator and an echo chamber. All these roles have a part in setting oil prices. The result is a peculiar market that says as much about global economics and politics as it does about supply and demand.

The Situation

After four years when the highest average oil prices in history seemed to defy economic gravity, petroleum fell in mid-2014. It had risen to $107.73 a barrel that June, even as Americans and Europeans drove fewer miles in more efficient cars, curbing consumption of gasoline, the biggest source of oil demand. Meanwhile, supply expanded as the sustained higher prices made techniques such as deep water drilling and fracking pay off. Those fundamentals started to register in the summer, as Chinese imports sagged, Europe teetered on the brink of recession, and the stronger U.S. economy made barrels priced in dollars relatively more expensive. Instead of stanching the glut by pumping less oil, Middle East exporters engaged in a price war to defend their market share. The price had dropped to $42.03 in March, the lowest since 2009, as U.S. storage tanks brimmed with oil. Then came a rebound above $50 a barrel after the conflict in Yemen. The price collapse had forced high-cost drillers in North Dakota and Texas to idle rigs while international giants like BP, Shell and Halliburton cut thousands of workers and billions of dollars in spending. Those developments led OPEC to declare its strategy a success at its June meeting and to maintain current production levels. With several members eager to increase their own production, Iran poised to ramp up exports after reaching a nuclear agreement with six world powers, and shale output proving surprisingly resilient as drillers cut costs and focused on the best terrain, the supply glut showed little sign of abating.

Source: Bloomberg

The Background

Through the mid-20th century, a group of multinational oil giants known as the Seven Sisters (including the companies that became Exxon Mobil, Chevron and BP) dominated the market. Controlling the barrels from the wellhead to the gasoline tank, they traded mainly with each other on confidential terms; there was no open market. Countries with oil fields wrested more control with the formation in 1960 of the Organization of Petroleum Exporting Countries. The cartel’s Arab members used their power for political and economic ends, shocking the global economy with an embargo in 1973. Prices spiked again in 1979 because of the Iranian revolution. In the 1980s, OPEC infighting, the emergence of new suppliers and the development of futures exchanges gave rise to new market-based prices. Today the international benchmark is Brent crude from the North Sea. The U.S. benchmark, West Texas Intermediate crude, started trading at less than the Brent price in 2010 as supplies of shale oil became plentiful. In 2013, the European Union raided offices of Shell, BP and others to investigate possible manipulation of reference prices produced by the publisher Platts.

The Argument

As the world industrializes and consumes more energy, each new barrel of oil costs more because the cheapest and easiest oil has already been pumped. This observation gave rise to a theory called “peak oil,” which holds that world production will eventually max out and decline as oil fields deplete. Skeptics of this notion point to the technological innovations that let U.S. producers extract oil and gas from previously impermeable shale, unlocking vast new resources, albeit at greater expense; the issue isn’t quantity but cost. The other variable is demand; no one knows oil’s future as consumers grow more efficient and switch to alternative fuels such as natural gas and renewable power. Oil supplied 31 percent of the world’s energy in 2012, down from 46 percent in 1973. There may come a day when oil gets cheap because it’s unwanted. That’s the argument often advanced by advocates of divestment. They warn of a financial crisis caused by a bursting “carbon bubble” of inflated energy-company valuations after fossil-fuel prices rise to account for the costs of contributing to global warming.

 

Source: Bloomberg

The Background

Through the mid-20th century, a group of multinational oil giants known as the Seven Sisters (including the companies that became Exxon Mobil, Chevron and BP) dominated the market. Controlling the barrels from the wellhead to the gasoline tank, they traded mainly with each other on confidential terms; there was no open market. Countries with oil fields wrested more control with the formation in 1960 of the Organization of Petroleum Exporting Countries. The cartel’s Arab members used their power for political and economic ends, shocking the global economy with an embargo in 1973. Prices spiked again in 1979 because of the Iranian revolution. In the 1980s, OPEC infighting, the emergence of new suppliers and the development of futures exchanges gave rise to new market-based prices. Today the international benchmark is Brent crude from the North Sea. The U.S. benchmark, West Texas Intermediate crude, started trading at less than the Brent price in 2010 as supplies of shale oil became plentiful. In 2013, the European Union raided offices of Shell, BP and others to investigate possible manipulation of reference prices produced by the publisher Platts.

The Argument

As the world industrializes and consumes more energy, each new barrel of oil costs more because the cheapest and easiest oil has already been pumped. This observation gave rise to a theory called “peak oil,” which holds that world production will eventually max out and decline as oil fields deplete. Skeptics of this notion point to the technological innovations that let U.S. producers extract oil and gas from previously impermeable shale, unlocking vast new resources, albeit at greater expense; the issue isn’t quantity but cost. The other variable is demand; no one knows oil’s future as consumers grow more efficient and switch to alternative fuels such as natural gas and renewable power. Oil supplied 31 percent of the world’s energy in 2012, down from 46 percent in 1973. There may come a day when oil gets cheap because it’s unwanted. That’s the argument often advanced by advocates of divestment. They warn of a financial crisis caused by a bursting “carbon bubble” of inflated energy-company valuations after fossil-fuel prices rise to account for the costs of contributing to global warming.

 

Tianjin Blast: Profound negligence or an act of terror

The blast at Tianjin shattered the entire world due to significant deaths and colossal economic losses. The Chinese authorities have not issued any official statement hinting towards possible cause of the blast. However, the western media is holding Chinese government responsible for the ‘negligence’. The reports refer to past incidents also where negligence was evident.

Ironically the west is not only the biggest buyer of Chinese goods but also has made huge investment. It may be true that Chinese government condoned violation of ‘good management practices’. However, the west can’t avoid even bigger blame as it buys Chinese products due to lower cost, which at times tantamount to compromising safety measures and allowing low wages for the workers.

Yet no one seems to be classifying this blast an act of terrorism. Keeping in view whatever is going on in South China Sea and adjoining areas, one just can’t rule out that this was an act of terror. Many of the developed countries including the US are afraid of China becoming a phantom eating up many industries of the developed economies.

The slow and gradual withdrawal of the US from the Middle East and MENA often creates suspicions that the after having attained self-sufficiency in crude oil production the new focus is South China Sea, particularly China and North Korea.

If 9/11 could be termed a melodrama staged by CIA, ISIS being ‘B’ team of intelligence agencies of the US, Britain and Israel, Tianjin blast could also be termed an act of terrorism to contain growth of China for a while. Signs of civil commotion have already started appearing and one has to wait and see how quickly the balloon is created and burst.

Is Israel bent upon destroying the US?

The success or failure of the P5+1 accord with Iran is expected to have momentous, world-historic consequences that go far beyond the Middle East. US President Obama is right in posing the question of choosing either a diplomatic accord or a large scale, long-term devastating war. While rest of the world including peace lovers in Israel wish to bring peace to this world, many war mongers including Israeli Prime Minister and other leaders having vested interest  are demanding continuation of proxy wars in general and in the Middle east in particular. The basic question to all the US citizens and peace lovers is, should they act independently for pursuing peace through diplomacy, the one currently sees unfolding with Iran and Cuba, or a submissive military instrument, directed by Israel’s proxies hell-bent on destroying America for Israel?

While many US intellectuals, liberals, progressives and leftists support the P5+1 accord (see the Scientists’ Letter to Obama on Iran Nuclear Deal, August 8, 2015 with 29 top scholars and Nobel laureates support diplomacy), few would dare to identify and attack Israel’s US proxies as they promote Tel Aviv’s agenda pushing the US to war with Iran.

The recently concluded accord has implications far beyond the ending of nearly 40 years of regional confrontation. Several fundamental factors deciding the basic question of continuing proxy wars is dependent on the US Senate and UN, feared to be acting on the dictate of Zionists. They have a common goal, “Keep the arsenal factories working at full capacity; irrespective of the fact how many million innocent people are killed to achieve this objective”.

All the major US spy agencies, including the CIA, long concluded that Iran did not have a nuclear weapons program. Its nuclear program has been proven to be limited to legal, internationally sanctioned peaceful civilian use. When the US intelligence establishment went ‘off-script’ and cleared Iran of a nuclear weapons program, Israel responded by brazenly assassinating five Iranian scientists and engineers, leaking faked evidence of a nuclear weapon program and directing its US proxies to push the US toward greater economic sanctions. They escalated their media campaign demonizing Iran, pushing for an economic and military blockade of Iran using the US naval forces in the Persian Gulf and its military bases in adjoining countries. Israeli officials want yet another US war for Israel along the lines of the Iraq invasion.

This has infuriated the Netanyahu regime. Its government leaders and agents met with the Presidents of the 52 Major American Jewish Organizations, leading Zionist Washington insiders and told them to launch an all-out campaign to sabotage the P5+1’ accord. The entire Zionist political apparatus immediately organized a multi-prong, multi-million dollar campaign. They followed the dictates of the Israeli Prime Minister against their fellow Democrat US President Obama.  The 52 organizations brazenly announced a $40 million budget to fund an Israeli front group “Citizens for a Nuclear Free Iran” to undermine P5+1 diplomatic efforts .Netanyahu’s ‘megaphones’ in the US mass media spread his message in their daily reports and editorial pages.

Israeli foreign and domestic policy is driven by its unchallenged regional supremacy. Military dominance through wars, territorial occupation, brutal armed interventions, extra territorial political assassinations of opponents and favorable one-sided treaties. To ensure its unquestioned dominance Israel has developed nuclear weapons/arsenal and largest missile launch capacity in the region and has openly declared its willingness to use nuclear weapons against regional rivals.

Israel’ mantra that it faces an ‘existential threat’ from its Arab neighbors and subjugated Palestinians has no factual basis. On the contrary, history has proved that Israel, directly and indirectly, has engaged in a series of aggressive wars devastating its Arab and Muslim neighbors. Israel has bombed and/or invaded Lebanon, Egypt, Jordan, Syria, Palestine and Sudan.  Israel has assassinated scientists in Iran and Palestinian political leaders as well as intellectuals, writers and poets in the Gulf, Jordan and Europe. Even family members were not spared by the Israelis.

Israel has been brutalizing its neighbors with total impunity because of its vast military superiority, but its real power is found in its overseas proxies, the Tel Aviv-dominated Zionist power configurations, especially in North America and Europe. The most important proxy organizations and individuals operate in the US. Thanks to them Israel has received over $150 billion dollars in economic and military grants and loans from US taxpayers in the past half-century. Each year Israel rakes in billions in tribute, billions in tax-free donations from billionaire Israel loyalists with dual US citizenship, who extract their wealth from American workers, investors and gamblers, and hundreds of billions via unrestricted investments, privileged market access and technology transfers.

Zionists supporting Israel are making and implementing of US Middle East policy that has led to the US invasions of Iraq, Syria and Libya; the current economic boycott and blockade of Iran; the breakup of Sudan; and the bombing of Somalia. Zionists in the US operates through various political instruments in different institutional settings. The pro-Israel mass media moguls and TV networks unconditionally defend Israel’s bombing, dispossession and repression of Palestinians while demonizing any Arab or Muslim states which has opposed its brutality – frequently calling for the US to impose sanctions and/or to launch armed attacks against Israel’s critics.

The US military campaign known as the ‘Global War on Terror’, includes brutal invasions and ‘regime changes’, launched after the attacks of September 11, 2001 was formulated and promoted by fanatical Israeli proxies in strategic positions within the Bush government, especially Paul Wolfowitz, Douglas Feith, ‘Scooter’ Libby, Elliott Abrams and Richard Perle. The boycott of Iran was designed and implemented by US Treasury officials Levey and Cohen. The drumbeat for war in Iraq and the phony ‘intelligence’ about ‘weapons of mass destruction’ was propagated by New York Times scribe Judith Miller, designed by Wolfowitz and Feith, backed by the 52 President of Major American Jewish Organizations and ultimately paid for with the lives of over five thousand Americans and well over a million Iraqi civilians.

The destruction and breakup of Iraq, a long-time supporter of Palestinian national rights, was accomplished without the loss of a single Israeli life – despite the enormous benefit the Jewish state has enjoyed from the war! The extraordinary success of this highest Israeli military priority was due entirely to the machinations of Israel’s highly placed US proxies. Yet the cost of the war has been very high for the US citizens that include a over a quarter million physical and mental casualties among US troops; two trillion dollars and counting in military expenditures crippling the US economy and a vast and growing army of disguised Islamist, killing Muslims around the world.