Pakistan Petroleum hopes to ‘soon’ hit hydrocarbon reserves in Iraq project

Pakistan Petroleum Limited team at one of its exploration wells , southeast of Baghdad city, Iraq April 14, 2019. (Photo Courtesy: PPL monthly publication PROGRESS)

• Company recently met with Saudi investors to discuss mining projects, CEO says
• Exploring options for joint initiatives with Chinese companies as part of CPEC

KARACHI: Pakistan Petroleum Limited hopes to hit hydrocarbon reserves soon at an Iraqi well where it began drilling in April this year, the company’s executive officer said on Monday, saying it hoped to share good news soon with shareholders about PPL’s first overseas exploration well.
“The current depth of the well is 4,232 meters and the final depth is 5,000 meters,” PPL managing director and CEO Moin Raza Khan said about Iraq’s Madian-1 operated Block 8 where the company is drilling for reserves. “The drilling process will come to an end within the next three months. We are going to catch the reserves pretty soon.”
In 2012, PPL initiated a contract with Iraq’s government to explore hydrocarbon reserves as an operator in an area spanning 6,000 square kilometers in Iraq’s Diyala and Wasit governorates.
“The cost of digging the overseas exploration well in Iraq is $27 million, an amount that has already been allocated,” Khan said. “Our budget is around Rs40-45 billion for exploration and other activities.”
Khan said PPL was expanding its mining operations in Pakistan as part of its diversification strategy. “For this purpose, the company is finalizing the feasibility study of barytes, lead and zinc project to further strengthen its mining portfolio,” he added.
The CEO said he had held a meeting with Saudi investors recently in which mining projects were discussed. He said PPL was also exploring options for initiating joint ventures with Chinese companies as part of the China-Pakistan Economic Corridor (CPEC).
“Ten days ago, we identified a number of blocks that fell on the CPEC route while talking to Chinese representatives about them,” Khan said “Such ventures will add value to the company in terms of technology transfer.”
PPL achieved its highest profit of Rs61.6 billion along with a record number of 11 discoveries during 2018-19 in different areas of Pakistan. The company announced a cash dividend of 20 percent on ordinary and convertible preference shares as well as 20 percent bonus shares to ordinary shareholders and 10 percent to convertible preference shareholders. The rupee devaluation has also helped the company increase its revenue.
PPL has also partnered with three other explorers, including ExxonMobil, for much publicized offshore drilling in the Arabian Sea at Kekra-1, which eventually failed to yield any oil and gas reserves.
“PPL drilled 30 exploratory and development wells, including in Kekra-1, in partner-operated offshore Indus G block which encountered excellent quality reservoir but was aborted due to difficulty in locating hydrocarbons,” Khan told shareholders on Monday.