PPL settles contract with Iraq’s Midland Oil Company

KARACHI: Pakistan Petroleum Limited (PPL) announced on Monday that its subsidiary, PPL Asia E&P BV, has reached a settlement with Iraq’s Midland Oil Company (MdOC).“The settlement between PPL Asia E&P BV and Midland Oil Company marks the conclusion of their exploration, development, and production service contract (EDPSC) for Block-8, Iraq, which expired in May 2022,” the company said in a press release.

Efforts to resolve the outstanding settlement from 2022 involved addressing longstanding disputes and claims between the parties. The company added that PPL Asia’s commitment to finding a resolution demonstrates sustained negotiations and legal efforts, culminating in an agreement signed on October 6, 2024 by PPL’s MD/CEO Imran Abbasy and MdOC’s DG Muhammad Yaseen Hassan.

PPL noted that a significant milestone in these efforts is the net settlement of $6 million, with MdOC making payment through a third party. “This final resolution closed all matters related to the contract without either side admitting fault or liability, reflecting the persistent and strategic endeavours to achieve a mutually favourable outcome after over two years of engagement,” the company said. They added that this not only brings closure to PPL’s operations in Block-8 but also delivers a valuable foreign exchange recovery for both the company and Pakistan.

PPL Asia was awarded the licence for the EDPSC for Block-8 in Iraq back in 2012. Drilling commenced in April 2019 at Block-8’s Madain-1 well, leading to the discovery of a sub-commercial volume of oil in FY20. Consequently, the well was plugged and abandoned.