OGDC makes oil and gas discovery in Sindh

KARACHI: Oil & Gas Development Company Limited (OGDCL), operator of Bitrism Block on Wednesday announced discovery of oil and gas from its exploratory well Pandhi #01 in district Sagnhar, Sindh.

The well has tested 9.12 million cubic feet per day (MMCFD) of gas and 520 barrels per day of oil through choke at wellhead flowing pressure of 840 pounds per square inch (Psi) from Lower Goru (Basal Sand) Formation.

The joint venture of Bitrism Block comprises of OGDCL as operator with 95 percent stakes while Government Holdings (Pvt.) Limited holds 5.0 percent stakes in the block.

“The discovery of Pandi # 01 is the result of aggressive exploration strategy adopted by the company in pursuance of the government's directive to explore and produce local oil and gas. It would add to the hydrocarbon reserves of OGDCL and the country,” the company said in a bourse filing.

The OGDC had earlier announced 120bpd of oil and 10.44 mmcfd of gas from Mangrio well #01 in May this year. Mangrio #01 is a exploratory cum appraisal well located in district Tando Muhammad Khan, Sindh.

The company has so far drilled 788 wells and made a total of 120 discoveries, according to its website.

The company currently produces 41,256 barrels of oil/day and 1,050 mmcfd of gas as well as 845 MT of LPG/day.

Ahsan Mehanti, an analyst at Arif Habib commodities said the discovery announced by the OGDC would be quite positive for the oil and gas sector.

“OGDC announced the discovery at the close of stock market, otherwise the impact would have been reflected on the oil and gas scrips.”

He said the market was expecting record growth in oil and gas sector financial results due to hefty rupee depreciation, as their earnings are pegged in foreign exchange

adding this discovery would bode positive for the exploration and production companies’ scrips.

“Such a significant discovery is good news for equity market as well as a sentiment builder for the country’s economy.”

The OGDCL in February said its net profit jumped almost 55 percent to Rs56.7 billion in first half (July-December) of the last fiscal year of 2018/19, mainly because of enhanced production and higher international oil prices.

The major contribution, around 70 percent, to the higher profit came from commercial production of two major oil and gas fields – Kunnar Pashkhi Deep (KPD) in Sindh and Nashpa field in Khyber Pakhtunkhwa.

The remaining 25-30pc contribution accrued because of higher international oil prices that generated windfall earnings to the company as the domestic well head prices are linked to international oil prices.