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September 26, 2018

KP gets possession of Lakki block for oil exploration


September 26, 2018

PESHAWAR: The Khyber Pakhtunkhwa after a long wait of over four years acquired exploration license in the Lakki Petroleum Concession Block and the provincial oil and gas company has got possession of the exploration-related activities in the block.

A Petroleum Concession Agreement (PCA) and Exploration License agreement had been signed between the Khyber Pakhtunkhwa Oil and Gas Company Limited (KPOGCL) and federal government during the last quarter of the last financial year.

However, practical and physical work could not be started in the block as the federal government wanted a former prime minister, Shahid Khaqan Abbasi, to inaugurate the exploration in the block by the KPOGCL.

Lakki exploration block, having an area of 1084.87 sqkm, is located in Lakki Marwat (63.48%), Karak (14.33%) and Bannu (22.19%) districts of the province. The Block falls in Prospective Zone-I.

Based on surrounding discoveries in Kohat-Bannu basin such as Chanda, Mela, Nashpa, Makori, Maramzai and Mamikhel, Lakki Block is considered to be a prospective block in the area.

Sources told The News that the incumbent Finance Secretary Shakeel Qadir Khan, who was also holding the additional charge of the Energy and Power Department at the time of the inking of the agreement, had tried to get the block inaugurated but to no avail.

However, the Pakistan Tehreek-e-Insaf (PTI)-led coalition government in its first month of its rule resolved the issue and awarded the Lakki block exploration to the KPOGCL.

The Finance Department sources said it would be the first major activity and the KPOGCL would launch since the inception of the company in 2013 which as the Finance Department document showed could utilise only Rs500 million of its development funds from 2013 to June 2018.

Shakeel Qadir told this scribe that the business plan of the KPOGCL could not pick up during its initial years as it could not get the exploration licence.

He said it had acquired shares with other companies, but these companies also could not start production as they failed to complete drilling and it added to the worries of the KPOGCL.

“One has to be a lean company until it starts production, but the KPOGCL hired around 400 employees who also proved to be a sort burden for the organisation,” he added. “I had completed human resource audit to evaluate work of the organisation,” Shakeel Qadir further said.

He said that exploration licence would be an impetus for both the province and centre in terms of oil production and resource generation.

The Lakki block is said to be highly prolific and would open new geological and technological vistas in the KP, upper Punjab and Baluchistan.

Lakki strata may have ultra-super structures waiting to be explored for perhaps one of the highest oil and gas production, the KPOGCL documents suggested. The KPOGCL officials say a number of investors were negotiating with it joint venture into Lakki block.

The KP’s petroleum prospects are high and the province is producing more than 55 percent of the total oil produced in the country over 15 percent of total gas and 25 percent of high-value Liquefied Petroleum Gas (LPG).

The KPOGCL, they said, planned to drill an exploratory well in the Lakki block in 2019-20 after mitigating the risks associated with exploration. In case of discovery, this will open a new venue for exploration and production.

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