OGDCL makes landmark oil discovery

State owned Oil and Gas Development Company Limited (OGDCL) has made a major oil discovery from “Nashpa well two”, in Karak, Khyber Pakhtunkhwa. Initial estimate of production of 3370 barrels per day, nearly equals 20 per cent of the company’s current crude output of 36,092 barrels per day (bpd).
Output likely to increase

A senior official of OGDCL said this is a major crude oil discovery as the output from the first formation is 3370 bpd of crude oil and it is likely to go up as the remaining four other formations are tested within next four weeks. He said there are high expectations of increase in output once other formations are tested but it was too early to give an estimate. Testing of four potential reservoir formations will also be undertaken wherein similar encouraging results are expected. Full flow potential of this well and the extent of the discovery will be determined after completing the testing program. An announcement made by the company said, OGDCL, the operator of Nashpa Exploration License, together with its joint venture partners Pakistan Petroleum Limited (PPL) and Government Holding Private Limited (GHPL) have discovered a new hydrocarbon bearing horizon from its appraisal well Nashpa 2, located in district Karak, KP.
Indigenous expertise employed

Structure of well was delineated, drilled and tested, utilising indigenous expertise. Nashpa well 2 was drilled down to depth of 4340 meter, to test the oil and gas potential of Datta, Shinawari, Samanasuk, Lumshiwal, Hangu and Lockhart formations. Significant reserves of hydrocarbons have been found at the well. First targeted zone “Datta Sandstone” has been tested and has produced 3370 barrels per day of crude oil and 11 MMCFD gas through 32/64 choke at well head flowing pressure 3800 psi. This discovery will add to the hydrocarbon reserve base of the company and joint venture partners, bringing significant savings to the country in term of oil import bill.

Results from Zin block

OGDCL earned a net profit after tax of Rs63.5 billion for the fiscal year ended on 30th June, 2011. During the first quarter of the current fiscal year, the company’s crude oil production remained 36,092 bpd which was almost equal to production during the same period last fiscal year. However, its gas production saw an increase of 7.8 per cent to 1,023 mmcfd as compared to the same period last year. The company is working on many development projects and the results from its most prospective Zin block are expected soon.

Net sales increase to Rs44.6 billion

OGDCL’s net sales increased to Rs44.6 billion in July-September period of current fiscal year as compared to Rs39.4 billion in the corresponding period last fiscal year. Net profit before taxation increased to Rs31.0 billion as compared to Rs24.1 billion in the corresponding period last fiscal year. The net profit after taxation increased to Rs21.9 billion as compared to Rs16.7 billion in the corresponding period of preceding year translating into earnings per share of Rs5.10 with a payable interim dividend of Rs1.50 per share.

Fact Check

The flagship national oil and gas exploration and production company, OGDCL is the largest upstream company in the country. It is listed on all three stock exchanges of the country and on London Stock Exchange since December 2006. Based on recently concluded reserve evaluation study carried out by Tracs International, UK OGDCL’s total proved, probable and possible remaining recoverable reserves as of 30th September, 2011 stood at 214 million barrels of oil and 10,660 billion cubic feet of gas.
It holds the largest portfolio of the recoverable hydrocarbon reserves of Pakistan, at 37 per cent of gas and 48 per cent of oil, respectively, as at December 31st, 2010. It contributed 23 per cent of the country’s total natural gas production and 56 per cent of its total oil production as at August 31, 2011. With a portfolio of 34 exploration licences, the company has the largest exploration acreage in Pakistan, covering 22 per cent of the total awarded acreage as of August 31st, 2011. While its primary activities are focused at onshore exploration, the company has also begun conducting offshore exploration activities.