Pakistan is blessed with enormous hydrocarbon potentials, most of which are still untapped. According to technical evaluation, original recoverable reserves were 1514.86 million barrels of oil and 61.355 Tcf of gas. Balance recoverable reserves are 570.31 million barrels of oil and 20.884 Tcf of gas.
2. Pakistan has large sedimentary area of 827,268 Sq. Kms in which only 1123 exploratory and 1496 Appraisal/Development wells have been drilled so far with an average well drilling density of 3.0 wells per 1000 Sq. Kms. These wells have resulted in 411 discoveries giving a success ratio of 1 : 2.8 which is quite attractive. About 95% of these wells are concentrated in Indus Basin whereas Balochistan, Khyber Pakhtunkhwa & Offshore area is virtually unexplored.
3. Ministry of Energy, Petroleum Division keenly desires to attract foreign investment with the objective to accelerate the exploration activities to maximize indigenous production of oil and gas. In order to be compatible in the global market the Government of Pakistan has introduced from time to time vibrant petroleum policies which contain attractive incentives. The salient incentives are reproduced as under:-
- Gas pricing formula to local and foreign companies as explained below:
Gas price for Zone-I (F) =7.0 $/MMBTU
|
At reference crude price of $ 110 BBL |
Zone-II = 6.46 $/MMBTU
Zone-III = 6.15 $/MMBTU
For Offshore Shallow = 7 $/MMBTU
Deep = 8 $/MMBTU
Ultra Deep = 9 $/MMBTU
- Transparent criteria for the award of exploration licenses on the basis of work units (per unit cost is US$ 10,000/-).
- Import of machinery/ equipment/material, etc. vehicles, vessels, at concessionary rates of duty.
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- The interested E&P companies are free to participate in the bidding round for acquiring an area either independently or jointly with other companies.
- Corporate tax is capped at 40% without ring fence.
- Renewal of lease after expiry of lease term for another five years subject to payment of 15% of the well head value.
- A bonanza of US$ 1/MMBTU shall be given for first three discoveries in offshore area.
- In order to attract foreign investment in the upstream petroleum sector, the government has finalized twenty (20) new exploration blocks and bidding is expected in the last quarter of this year. List of blocks is as under:
|
S.No. |
Block Name |
Area Sq.Kms |
|
1 |
3069-9 (Suleiman) |
2172.89 |
|
2 |
3068-6 (Killa Saifullah) |
2421.96 |
|
3 |
3068-10 (Block-28 North) |
637.05 |
|
4 |
2762-2 (Desert) |
2231.3 |
|
5 |
3067-7 (Sharan) |
2497.89 |
|
6 |
3372-25 (Abbotabad) |
2298.67 |
|
7 |
3170.11 (D.I.Khan West) |
311.55 |
|
8 |
3471-1 (Nowshera) |
1711.06 |
|
9 |
3372-26 (Hazro) |
653.74 |
|
10 |
3273-5 (Jhelum) |
1524.65 |
|
11 |
3372-27 (North Dhurnal) |
56.18 |
|
12 |
3072-9 (Okara) |
2492.48 |
|
13 |
3171-2 (Nurpur) |
518.19 |
|
14 |
3272-16 (Lilla) |
2361.12 |
|
15 |
2972-7 (Vehari) |
2487.28 |
|
16 |
2972-8 (Sutlej) |
2312.56 |
|
17 |
2770-4 (Islamgarh) |
2229.51 |
|
18 |
2668-23 (Khewari East) |
1451.23 |
|
19 |
3068-9 (Nareli) |
2414.95 |
|
20 |
2467-17 (Sujawal South) |
1914.1 |
Technical write up of blocks available for next bidding round.
4. As a result of investment friendly policies and other fiscal incentives, fairly large number of multinational companies which include ENI, United Energy Pakistan, MOL of Hungary, China ZhenHua, Polish Oil& Gas Company etc. have embarked upon exploration and production activities in Pakistan. Exxon Mobil has acquired 25% working interest in an Offshore Block Indus-G.
5. Apart from above, a policy for unconventional hydrocarbon reservoir i.e. Tight Gas (Exploration & Production) Policy, 2011 has also been notified in which 20% premium over Petroleum Policy, 2012 price has been provided for investors. Low BTU policy containing lucrative incentives for E&P companies exploring and producing Low BTU gas has also been notified. The Petroleum Division is also in process of formulating Shale Gas Policy, which will also attract many multinational companies to come to Pakistan for undertaking exploration to discover Shale Gas and Shale Oil in the country
6. OGDCL and PPL are the two public sector companies engaged in the exploration of oil and gas in Pakistan. These two companies contributes major share of oil and gas production. OGDCL and PPL are willing to enter into joint venture projects with foreign E&P companies in exploration of hydrocarbons in Pakistan. Foreign E&P companies are encouraged to come to Pakistan and start exploration activities either independently or in joint venture with OGDCL and PPL. The interested companies may obtain further information in this regard from Ministry of Energy (Petroleum Division) Web site www.mpnr.gov.pk & www.ppisonline.com.
08-06-2020