Pakistan finalizes policy amendments to attract foreign investors ahead of fresh exploration blocks auction
KARACHI: Pakistan government has finalized modifications in the Petroleum Policy to attract foreign companies, which would be affected in the next three to four months; and soon after that 35 new blocks would be put on auction, Special Assistant to Prime Minister on Petroleum, Nadeem Babar said on Thursday.
“We are in talks with several international exploration companies and signed agreements with some of them including Kuwait Petroleum, whom are interested in Pakistan’s exploration and production sector,” Babar said speaking to newsmen at Pakistan Petroleum Limited (PPL) Head Office.
He informed that agreements would soon be signed with a couple of European companies while Exxon Mobil had also expressed intention to acquire exploration blocks in the upcoming auction.
Babar said that in the past years, many foreign E&P companies left Pakistan due to regulatory issues and procedural hurdles. “We have identified 6-7 issues in the Petroleum Policy that were discouraging foreign companies’ draft amendments have been prepared, which would be implemented a couple of months,” PM’s Special Assistant said adding the auction of 35 new blocks would commence by the end of this year and would continue till the end of next year.
“Moreover, the government is conducting surveys and studies pertaining to these new blocks to facilitate the intending companies decide which blocks to bid for,” he said.
Babar said country’s E&P sector was inactive as there had been no auction of blocks in the past few years while the companies including PPL and Oil & Gas Development Company (OGDC) were directionless due to no support from the government.
“We have to revive these companies and increase indigenous production of oil and gas given the country’s economic situation,” Babar said adding government would extend all support and facilitation of these companies.
Talking about the offshore exploration, PM’s Special Assistant said it was unfortunate that the Kekra-I project failed, but exploration activities would continue the high-prospect offshore region.
Acting Managing Director PPL Moin Raza Khan said the existing gas reserves were depleting and the company was focusing on organic growth through new blocks.
The last bidding round was held in March 2013 by the Pakistan Peoples Party (PPP) led government.
According to reports, 113 new oil and gas discoveries were made in the past around five years and 73 supplemental agreements were signed to provide better price incentives of the Petroleum Policy 2012 for holders of older petroleum concession agreements.
At present, Pakistan produces around 4 billion cubic feet of gas/day (bcfd) and 86,000 barrels of oil/ day.