Mari buys 20 percent stakes into Tullow’s Bannu West Block

KARACHI:  Mari Petroleum Company Limited (MPCL) has bought another 20 percent stake in Bannu West Block from Tullow Pakistan Development Limited (TPDL), taking its share in the block to a total of 30 percent, the company said on Wednesday.

Tullow will retain a 20 percent stake in the dormant Bannu West Block, spread over an area of 1,229.57 squire kilometer, promising hydrocarbons reserves.

“The Board of Directors of MPCL has approved transfer of operation of Bannu West from Tullow Pakistan alongwith 20 percent increase in MPCL’s working interest in the block,” Mari said in a statement issued to Pakistan Stock Exchange.

The company will now become the operator of the block and its working interest will increase to 30 percent from existing 10 percent, it added. "MPCL is in the process of obtaining security clearance from the relevant authorities to commence work in the block."

Bannu West Block straddles district Hangu, FR Bannu, North Waziristan and Khurram Agencies. The block falls in hydrocarbons prospectively Zone-I. The block was awarded to TPDL on April 27, 2005. Later on, OGDCL, MPCL and SEL joined as joint venture partners.

Currently, TDPL is the operator of the block with 40 percent working interest, while OGDCL, MPCL and SEL have 40 percent, 10 percent, and 10 percent working interest, respectively.

 “The block is interpreted to be promising for hydrocarbons find, subject to firming-up of valid drillable prospects,” the statement said.” Extensive hydrocarbons exploration is in progress on the eastern side of the block and as a result of exploration activities carried out in the surrounding areas, significant oil and gas/condensate discoveries have been made in the vicinity.”

Mari said due to security reasons, TPDL has been unable to commence exploration activities in the area since the award of the block on April 27, 2005.

Tullow has been active in Pakistan since 1991 and currently has five exploration licences in the country Pakistan which included Block 28 (95 percent and operator), Bannu West (40 percent and operator), Kohat (40 percent), Kalchas (30 percent), and Kohlu (30 percent).

In March 2012, Tullow took the decision to off load some of its Asian assets in order to focus on its core African and Atlantic Margin strategy.   Its reduced programme includes wells in Gabon, Kenya, the Netherlands, Suriname and Pakistan.

Tullow signed a sale and purchase agreement for its Pakistan assets to Ocean Pakistan Ltd in October 2013 for $25 million. In December 2014, Tullow was advised that the Government would not approve the sale due to regulatory concerns.