Pakistan Petroleum Limited plans to spud nine exploratory and six development wells in FY24.

The management of Pakistan Petroleum Limited held a Corporate Briefing session on 15th Nov’23 to discuss the FY23 financial result and future outlook of the company.


To recall, the company posted a profit after tax of PKR 97,937mn (EPS: PKR 35.99) during FY23 compared to PKR 53,546mn (EPS: PKR 19.68) in FY22, showcasing a surge of 83% YoY amid i) jump in Sui wellhead price by 16% YoY, ii) Pak Rupee depreciation against USD, and iii) 1% growth in gas production.

The management informed that in FY23 company has spud three exploratory wells and five development wells. For FY24, the company plans to spud 9 exploratory and 6 development wells.

Four discoveries were made by the company in FY23: i) Shahpur CN X-1, ii) Rayyan-1, iii) Tolanj West (Lockhart formation), and iv) Tolanj West (Shinawari & Samanasuk formation).

As per the management, gas production from Sui and Kandhkot field witnessed a decline of 7% and 12% YoY, respectively.

During FY23, the company was awarded 1 operated and 3 partner operated blocks. Furthermore, the management plans to acquire more blocks in order to conduct more exploration activities to mitigate natural decline in major field.

The management told that due to circular debt, trade debts during Jun’23 surged to PKR 513bn, 49% and 47% receivables are due from SNGP and SSGC, respectively. The government has revised consumer prices in Nov’23, which according to the management will have a positive impact on company’s collections and will improve company’s cashflows. For the outstanding circular debt, the management told that the company is actively engaged with the government.

The management informed that the PIOCL has planned to drill 5 wells in Abu Dhabi Block-5, with first spud in expected in Jan’24.

Regarding Reko Diq project the management told that, the project is undergoing feasibility study (which will end in 2024). The management expects mining to commence in 2028.

On question related incursion of water at Adhi field, the management told that the company is contemplating to drill a disposal well resolve this issue.

The management shared that the company is focusing on frontier blocks, while also considering overseas diversification. Moreover, the company is also contemplating to re-allocate gas to different customers.

The management informed that awarding of Sui D&PL is pending for a long time. Currently negotiations between Federal Government and Government of Balochistan are ongoing to resolve the matter.

The company is actively working on revamping compressors in Sui.

Courtesy- AHL Research


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