KARACHI: In a major boost for Pakistan’s energy sector, new oil and gas deposits have been discovered in a well jointly operated by the Oil and Gas Development Company Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Pakistan Oilfields Limited (POL) in the Kohat district of Khyber-Pakhtunkhwa (K-P).
Additionally, Pakistan Petroleum Limited has upgraded gas compressors at the Sui gas field, one of the country’s largest, to enhance fuel output from aging wells.
The discovery of new deposits and the enhancements in production from older fields are expected to significantly boost Pakistan’s energy security, reducing reliance on expensive energy imports and conserving foreign exchange reserves.
In separate notifications to the Pakistan Stock Exchange (PSX), OGDCL, PPL, and POL reported successfully testing around 16.4 million standard cubic feet per day (mmscfd) of gas and 159 barrels per day of condensate (crude oil) from the Kawagarh-1 formation in the Razgir-1 exploration well, drilled on January 9, 2024.
The TAL joint venture, comprising OGDCL with a 30% working interest, MOL Pakistan Oil and Gas Co BV (the operator) with 10%, PPL with 30%, POL with 25%, and Government Holdings Private Limited (GHPL) with 5%, made the discovery.
OGDCL’s notification highlighted that this new find has de-risked further exploration in the TAL block, opening new opportunities and enhancing the country’s indigenous hydrocarbon supply and reserves.
POL’s notification added that the tested hydrocarbons, measuring 16.40 mmscfd of gas and 159 barrels per day of condensate, were recorded before any acid stimulation job.
Testing operations are ongoing to determine the well’s true potential, and actual production figures may differ significantly from these initial test results.
PPL’s notification stated that the discovery would significantly enhance the country’s energy security by utilizing indigenous resources.
In another notification, PPL reported identifying and executing a production enhancement project at the Sui Gas field by revamping SML compressors, resulting in a production increase.
This initiative, which addressed declining wellhead pressure due to field aging, led to a gain of 19 mmscfd of gas.
The project, initiated in March 2023 and completed in June 2024, successfully revamped all seven SML compressors to operate at a lower inlet pressure, thus sustaining production from the Sui Gas field.
This additional and cost-effective indigenous hydrocarbon production is expected to help bridge the energy demand-supply gap, saving significant foreign exchange for the country.
These announcements positively impacted the share prices of listed oil and gas exploration firms, leading to notable turnover at the Pakistan Stock Exchange (PSX) on Tuesday.
Earlier, in mid-July 2024, Pakistan Oilfields Limited (POL) reported discovering 714 barrels of crude oil per day and 10.2 million cubic feet per day (mmcfd) of gas from the Jhandial-03 well in the Ikhlas Block in the Attock District.
This discovery accounts for about 1% of the country’s total oil production and 0.3% of its gas output from domestic hydrocarbon fields.
Weekly production data indicates that crude oil production stood at 68,248 barrels per day for the week ending June 23, 2024, while gas production was at 3,146 mmcfd.
POL described this hydrocarbon discovery as a “significant quantity” in a PSX notification, though it remains moderate in terms of domestic requirements.
Energy experts estimate that Pakistan meets nearly 70% of its total energy requirements through expensive imports, while local production caters to only 30% of national needs.
According to the Pakistan Bureau of Statistics (PBS), energy imports accounted for over one-fourth ($15.34 billion) of the total $49.85 billion in imports for the first 11 months of the previous fiscal year.
The government recently approved a policy for tight oil and gas discoveries, offering a 40% higher tariff on these hydrocarbons compared to conventional ones. This policy is expected to boost local production and significantly reduce the need for imports.
