Share this story!            

Security situation impeding oil and gas exploration

By Sajid Chaudhry


ISLAMABAD: Security situation in the country has been the single major hurdle in enhancing oil and gas exploration activities despite bright prospects for discoveries.

Even public sector companies have not been able to enter Balochistan and NWFP due to the uncertain security situation.

Secretary Petroleum, Mehmood Saleem Mehmood and Managing Director OGDCL Zahid Hussain briefed the committee on the performance of the company as well as initiatives being taken to enhance oil and gas production.

MD OGDCL informed the committee that Oil and Gas Development Company Limited (OGDCL) has not been able to bring into the system newly discovered 300mmcfd gas and 7000 barrel per day crude oil in the system due to the massive and useless litigation by the private sector companies.

Secretary Petroleum informed the meeting that the newly discovered 300mmcfd gas was enough for power generation and eliminating power load shedding totally from country as well as eliminating any chance for closure of industrial sector during forthcoming winter peak season.

It was also informed to the Committee that with the addition of 100mmcfd gas from new discovery at Kohat gas load shedding for industrial sector to remain low during current winter season.

He also pointed out that some Rs 49 billion of OGDCL money is struck up with the private sector companies and refineries due to which company’s investment and exploration operations are in danger. If these dues were not recovered than the OGDCL would have only option to approach banks for loans. If the financial position of the company is not corrected than OGDCL would not be able to announce dividend for its shareholders for second quarter.

The committee was informed that ministry is preparing a uniform formula for regularisation of all its contract employees working from the last five years in the company.

MD OGDCL further informed the committee that OGDCL, with the help of a British consultant, has recently completed a latest study that provides latest data and information about the prospects of presence of oil and gas reserves in different parts of the country. The study completed in three years hectic efforts would help public sector as well as private sector E&P companies to expand their area of operation. He informed that Middle Indus Basin near Badin has been identified as most potential area for exploration of oil and gas along with other Potohar, Bannu and Kohat, Upper Indus and Lower Indus regions. Ouch and Qadirpur and Pak-India border area along Sindh have also been identified as potential areas.

He informed the committee that bids have been invited for 5 dormant oil and gas fields till November 15 for their auction to private sector. OGDCL has been only company in the world that has earned after tax profit of Rs 55.54 billion last fiscal year when almost all the companies in the world were facing losses.

The committee was informed that OGDCL intends to internationalise its exploration activities and in this regards prospects in Libya, Sudan Russia and some other countries are being evaluated.

Committee members were appreciative of the performance of OGDCL, however, they were of the view that induction of local population in newly discovered fields could help manage security issues. They also proposed to adopt arbitration mechanism for minimising litigation so that newly discovered reserves could be used for the betterment of economy. They also urged upon the OGDCL management to gear up its efforts in exploration and production so as to minimise the oil import bill.

Home | Business

Share this story!