ISLAMABAD: The state oil and gas corporation, Oil and Gas Development Company Limited (OGDCL) and Pakistan Petroleum Limited (PPL) will jointly bid to acquire British oil giant British Petroleum’s (BP) assets in Pakistan.
Official sources indicate this decision was made during a recent meeting of the OGDCL board. The management of the company was directed to immediately appoint a specialist consultant firm to prepare a bid for BP assets in Pakistan. The British petroleum giant has set a cut off date of November 20 for receiving statements of interest.
The government has also given its approval to exercise its pre-emptive right to buy out BP’s interests. The estimated cost of the acquisition is not yet known and will be finalized by the consultant after carrying out due diligence. If the price is too high then the OGDCL and PPL may join other foreign companies for a joint bid, sources said.
The British oil company has already confirmed to the government that they are in the final stages of selling their assets in Pakistan. BP is one of the most successful foreign exploration and production companies in Pakistan. Its operations are mainly limited to Sindh province. It produces about 250 million cubic feet of gas a day and 14,000 barrels a day of crude oil.
OGDCL is the largest petroleum exploration and production company in the Pakistan’s oil and gas sector, albeit mainly focused on gas. It holds the largest portfolio of the recoverable hydrocarbon reserves of Pakistan, at 35 percent of gas and 46 percent of oil deposits, respectively, as at January 2009. OGDCL had a net profit after tax of Rs. 59.17 billion for the full year ended June 30, 2010.
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