PPL secures development lease extension for Sui gas field

KARACHI: Pakistan Petroleum Limited (PPL) has received approval for a development and production lease (D&PL) over the sui gas field, covering an area of 455.8 square kilometres, for a period of 10 years, effective from June 1, 2015 to May 31, 2025, the company announced on Monday.

According to PPL’s notice to the Pakistan Stock Exchange (PSX), this approval aligns with the Pakistan Onshore Petroleum (Exploration & Production) Rules, 2013, and PPL holds a 100 per cent working interest in the field.

The original sui mining lease (ML) expired in 2015 after a 60-year term, prompting the company to apply to the director general petroleum concessions (DGPC) for a D&PL over the Sui field.

As of September 30, 2024, total liabilities related to the lease extension -- covering lease extension bonus, production bonus, and social welfare/training obligations -- amount to Rs52.5 billion.

These liabilities, along with future obligations, will be paid by May 2025 according to the payment schedule approved by the Economic Coordination Committee (ECC).Under the Rules, the D&PL is eligible for extension. Given the economic viability and ongoing production at the Sui field, PPL intends to pursue an extension of the lease period.

The company will now finalize the D&PL and Petroleum Concession Agreement (PCA), enabling it to fulfil its financial obligations as approved by the federal government and seek further extensions in line with regulatory guidelines.