Top Countries Discovering Oil and Gas:
Russia led with 10 discoveries, followed by Australia with seven discoveries and Colombia with four discoveries. Pakistan and the UK each had three discoveries in the fourth quarter of 2017, according to Global Oil and Gas Discoveries Review.
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| Oil and Gas Discoveries 2H/17. Source: Offshore Technology |
In fourth quarter of 2017, the Former Soviet Union leads with 12 discoveries, followed by Asia with eight discoveries, and Oceania with seven discoveries. Europe and South America had five discoveries each, followed by North America with two discoveries, while the Middle East and Africa had one discovery each in the quarter, according to Offshore Technology website.
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| Top 3 Offshore Drilling Sites in Asia-Pacific. Source: Bloomberg |
Exxon-Mobil's Entry in Pakistan:
American energy giant Exxon-Mobil has joined the offshore oil and gas exploration efforts started by Oil and Gas Development Corporation (OGDC), Pakistan Petroleum Limited (PPL) and Italian energy giant ENI, according to media reports.
Each company will have 25% stake in the joint venture under an agreement signed at the Prime Minister’s Secretariat in May among ExxonMobil, Government Holdings Private Limited (GHPL), PPL, ENI and OGDC.
Exxon-Mobile's entry in Pakistan brings deep offshore drilling technology, its long experience and financial resources to the country. It is expected to accelerate exploration and more discoveries.
Pakistan Oil Basins:
A Pakistan Basin Study conducted in 2009 found that the country has six onshore and two offshore basins; offshore basins being the Indus basin and the Makran basin in the Arabian Sea.
The Indus offshore basin is a rift basin that geologists say developed after the separation of the Indian Plate from Africa in the late Jurassic period. It is believed to be the second largest submarine fan system in the world after the Bay of Bengal with high probability of hydrocarbon discoveries.
The Makran Offshore basin is separated from the Indus Offshore basin by Murray ridge, according to Syed Mustafa Amjad's report in Dawn. It is an oceanic and continental crust subduction zone with deepwater trenches and volcanic activity. The basin consists of oceanic crust and periodic emergence of temporary mud islands along the coast suggesting strong evidence of large hydrocarbon deposits.
Pakistan Hydrocarbon Potential:
The United States Energy Information Administration (EIA) estimates that Pakistan has 586 TCF (trillion cubic feet) of gas in Pakistan of which 105 TCF is technically recoverable.
In addition to gas deposits, US EIA estimates there are 227 billion barrels of oil in Pakistan with 9.1 billion barrels being technically recoverable.
Pakistan also has 185 billion tons of coal deposits in Thar desert which are just beginning to be extracted by Sindh Engro Coal Mining Corporation.
Oil and Gas exploration and production companies are currently planning to drill 90 wells in different parts of the country. Under the plan, as many as 50 exploratory and 40 development wells would be drilled in a bid to make the country self-sufficient in the energy sector, according to media reports.
During the last five years, the sources said the exploration and production companies drilled 445 new wells, out of which 221 were exploratory, adding that the increased exploration activities resulted in 116 new oil and gas discoveries.
Current Account Deficits:
Energy imports make up a big chunk of Pakistan's total imports. Rising oil prices worsen the current account deficit and put pressure on Pakistan's reserves, forcing the country to seek periodic IMF bailouts.
Pakistan’s current account deficit has jumped by 50% to a record high of $14.03 billion in the first 10 months of the current fiscal year 2018, according to the State Bank of Pakistan. The country imported $12 billion worth of energy in 2017. The bill is likely to grow with increasing demand and rising prices in 2018.
Reducing energy imports by increasing domestic production will likely ease Pakistan's current account deficits and reduce its chances of going back to the IMF again and again.
Summary:
Pakistan made 2 key oil and gas discoveries in 3rd quarter and another 3 discoveries in the 4th quarter of 2017. These discoveries appear to have prompted US-based Exxon-Mobil to join off-shore drilling efforts in Pakistan. American energy giant's entry in Pakistan brings advanced deep sea drilling technology, its long experience in offshore exploration and financial resources to the country. It is expected to accelerate exploration and lead to more discoveries. US Energy Information Administration (EIA) estimates that Pakistan has technically recoverable deposits of 105 trillion cubic feet (TCF) of gas and 9.1 billion barrels of oil. Reducing energy imports by increasing domestic production will likely ease Pakistan's current account deficits and reduce its need to seek repeated IMF bailouts.
Related Links:
Haq's Musings
South Asia Investor Review
US EIA Estimates of Oil and Gas in Pakistan
Methane Hydrate Release After Balochistan Quake
Thar Coal Development
Why Blackouts and Bailouts in Energy-Rich Pakistan?
Riaz Haq's Youtube Channel
32 comments:
Awesome news. Let’s just hope Exxon
doesn’t do in Pakistani waters what BP
did in the Gulf of Mexico a few years ago.
Any idea how many Pakistani locals will
be hired by Exxon for its deep sea
exploration, both during construction
and production? It is potentially a massive
project.
I am optimistic on Pakistan's offshore hydrocarbon potential.
Offshore drilling is an expensive endeavor. ExxonMobil will want good terms to risk such capital for exploratory wells.
Ahsan: "Any idea how many Pakistani locals will be hired by Exxon for its deep sea exploration..."
Pakistani exploration and production companies OGDC and PPL have half the stake in this joint venture. Italy's ENI has 25% and Exxon 25%.
Exploration work was started by OGDC and PPL which proved the offshore hydrocarbon potential.
Italy's ENI joined later and American ExxonMobil came on board just last month.
We should thank God for this gift but should also ensure that our corrupt democratic leaders give the oil’s benefit to the nation instead of looting it themselves!
Unprecedented growth witnessed in petroleum sector in five years
https://tribune.com.pk/story/1720526/1-unprecedented-growth-witnessed-petroleum-sector-five-years/
To step up search for oil and gas in potential areas across the country, the government encouraged oil and gas Exploration and Production (E&P) companies by providing maximum incentives.
Experts say the thrust produced satisfactory results.
The exploration activities registered 80 per cent increase with 40 per cent success rate. Drilling of appraisal and development wells went up by 12.8 per cent, discoveries rose by 151.3 per cent, 2D and 3D seismic surveys increased by 37.2 per cent and 43.1 per cent, respectively.
Consequently, domestic oil production grew by 29.8 per cent, meaning significant relief on the side of heavy oil import bill.
A senior official in the Petroleum and Natural Resources Division told APP that during first four years of the PML-N government, the companies drilled over 179 exploratory and 194 appraisal wells that resulted in 101 new oil and gas discoveries, while the previous government had drilled 100 exploratory and 172 appraisal/development wells, achieving just 39 oil and gas discoveries.
In the four-year span, more than 944 million cubic feet per day (mmcfd) of gas and 32,343 bpd oil were added to the transmission network across the country through indigenous resources.
The country’s total crude oil production reached around 90,000 bpd oil.
The official said 68 findings, out of total 101 discoveries, had added proven reserves of about 5.4 trillion cubic feet (tcf) gas, while calculations regarding 33 wells were yet to be determined. As many as 87 findings were made in Sindh, seven each in Punjab and Khyber-Pakhtunkhwa.
During the same period, the country is estimated to have consumed about 5.2 tcf gas which means that more than 100 per cent replacement had been made for the resource consumed.
Besides, over $10 billion foreign investment poured into the country’s petroleum sector, despite low oil price scenario in the international market.
Determined to achieve self-sufficiency in the energy sector, the government also completed a study in collaboration with USAID which confirmed the presence of 3,778 tcf shale gas and 2,323 billion of stock tank barrels (BSTB) shale oil in place resources.
Following which, a Shale Gas and Oil Centre has been established at the ministry to facilitate interested E&P companies in tapping the identified 188 tcf gas and 58 BSTB oil technically recoverable resources in lower and middle Indus Basin.
Besides, a consortium of Oil and Gas Development Company Limited (OGDCL) and Pakistan Petroleum Limited (PPL) has been formed to undertake pilot project(s) to determine cost of extracting shale gas and oil.
In a landmark development, Pakistan signed a 15-year agreement with Qatar for import of LNG to meet its growing energy needs as existing natural gas reserves were insufficient to bridge the ever-increasing gap between demand and supply of the commodity. The gas supply-demand gap has reached around 4 billion cubic feet per day (bcfd) as total gas demand of the country is 8.0 bcfd against total supply of 4.0 bcfd. Needless to say in winter, the demand rapidly increases.
It is believed that LNG was the cheapest alternative fuel and the only instant available remedy to meet the country’s energy needs when the existing natural gas reserves were diminishing.
Country’s oil import bill surges by 30.43pc to $12.928bn
https://profit.pakistantoday.com.pk/2018/06/20/countrys-oil-import-bill-surges-by-30-43pc-to-12-928bn/
Pakistan’s oil import bill rose nearly 30.43 per cent year-on-year to $12.928 billion in July-May 2017-18 owing to an increase in global prices of crude oil and rising demand of petroleum products in the country.
The amount of the oil import bills is around one-third of the total import bill for the period.
The trade deficit is widening as the overall import bill of the country has been on the rise since the start of 2017-18.
The State Bank of Pakistan (SBP) on Wednesday showed the current account deficit at around $15.961 billion in July-May 2017-18 billion which surged by 43 per cent as compared to the previous year.
Liquefied Natural Gas (LNG) imports rose by 84.5 per cent in the last eleven months of the current fiscal year to $2.123 billion as compared to the previous year’s gas imports worth $1,150 billion.
Official figures released by the Pakistan Bureau of Statistics (PBS) on Wednesday showed that the petroleum imports increased 30.5 per cent year-on-year to $12.928 billion which was around $9.912 billion in the same period last year.
A 60.35 per cent growth was recorded in the import of crude oil year-on-year to $3.738 billion. But in terms of quantity, a growth of 28.72 per cent was posted year-on-year to 9.45 million tonnes, indicating that a large share of the increase is on account of higher prices.
Imports of petroleum products went up 9.54 per cent to $6.808 billion the eleven-month period. The petroleum products recorded a nearly negative 4.66 per cent in quantity year-on-year to 14.362 million tonnes.
In the current fiscal, year the second-biggest component in the import bill was transport group whose import rose 27.88 per cent year-on-year to $3.821 billion in last eleven months of this fiscal year. The increase is due mainly to massive imports of busses/ trucks (60.8 per cent), and motor cycle (57.88 per cent).
New investment models needed to boost MENA oil, gas competitiveness
https://pakobserver.net/new-investment-models-needed-to-boost-mena-oil-gas-competitiveness/
New investment models will encourage optimal development in the oil and gas sector, Majid Jafar, CEO of Crescent Petroleum told OPEC ministers and industry leaders at the OPEC Seminar in Vienna last June 20. The private sector in MENA can be an important partner in oil and gas development, helping boost competitiveness in the industry, he added.
“We need new investment models that will create the right incentives for upstream investment in exploration in new areas, enhanced recovery from mature fields, and gas development, where the region continues to lag despite growing demand from the regional power and industry,” Jafar said.
Jafar, who leads the Middle East’s oldest private oil and gas company and serves as Vice-Chairman of the Crescent Group of companies, was speaking at the 7th OPEC International Seminar in Vienna, Austria. More than 750 participants, including ministers, industry leaders and experts gathered at the Imperial Hofburg Palace in Vienna to discuss the global energy outlook, market stability, oil investments, technology, and the state of the world economy.
“The region needs at least $320 billion in investment over the next five years, and the private sector can be an important partner in this effort. The Middle East has over half the world’s proven oil & gas reserves but represents only a third of the oil market and a sixth of the gas market today, so we have yet to fulfill our potential as a region” Mr Jafar said, speaking on the panel entitled “Investment in the Oil Industry”, along with the oil ministers of Iraq and Kuwait, and international industry leaders from the public and private sectors.
“Our industry worldwide must also do better at explaining how responsible development and utilization of oil and gas can support the transition to a more sustainable economy,” he said. “The switch from coal to gas-fired power generation, which emits half the volume of CO2, may have the greatest impact on lowering carbon footprint. “That is why we firmly believe that the oil & gas sectors will continue to play a vital role in meeting world’s energy needs for transportation and power generation going forward, complementing renewables and other energy sources,” he added.
Among numerous UAE Ministers and industry leaders attending the forum include: Suhail Mohamed Al Mazrouei, UAE Minister of Energy and Industry and current President of the OPEC Conference; Sultan Ahmed Al Jaber, UAE Minister of State and Group CEO of ADNOC; and Musabbeh Al Kaabi, CEO of Mubadala Petroleum and Petrochemicals. Commenting on his participation, Jafar said: “I’m honored to have joined industry leaders and experts as we debated the greatest challenges facing the energy sector and the regional economy. The Middle East is a major source of the world’s proven gas reserves and is also becoming a key consumer of both oil and gas. Our prosperity is incumbent upon our ability to anticipate and respond to the dramatic changes in world energy demand.” —SG
We must remember that the “Number” of discoveries is totally different from “Size” of the discoveries. These were the top 10 oil hydrocarbon discoveries during 2017.
https://info.drillinginfo.com/top-10-oil-gas-exploration-discoveries-2017/
You can see Pakistan is nowhere. Petroleum is the only field that I know a little about and I would like to put things in their proper perspective.
Major oil find in #Pakistan near #Iran border. Minister for Maritime Affairs/ Foreign Affairs Abdullah Hussain Haroon says ExxonMobil has indicated that it is close to hitting huge #oil reserves which could be even bigger than #Kuwait's reserves. #energy
https://www.dawn.com/news/1424804
Addressing business leaders at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), the minister said that ExxonMobil — an American multinational oil and gas company — has so far drilled up to 5,000 meters close to the Iranian border and is optimistic about the oil find.
The Government of Pakistan, he said, has already taken an undertaking from the company to set up a generation complex worth $10 billion.
The government is also encouraging Chinese and Western investment in the country, he added.
He further said that there is a need to integrate the Karachi Port and Port Qasim so that they could supplement each other in the larger interest of the country.
On the occasion, he said the Pakistan National Shipping Corporation (PNSC) has sufficient funds for purchasing two vessels but this will be done by next government.
The minister said that there is greater need to have new area for fish harbour because the existing one has many issues and there is shortage of land. However, he regretted that the harbour is not well kept and hoped that the European Union (EU) will give subsidy for new fish harbour.
“Foreign investors are interested in coming to Pakistan, provided we manage to meet their standards and attract them to make investment,” he stressed.
The minister advised that ports should be developed so that they could meet the country’s demand on the basis of its markets and products and fully supported the Karachi Port Trust (KPT) development projects highlighted by KPT Chairman Admiral Jamil Akhtar.
Responding to a question, Mr Haroon said that there was no need to give Pakistani land to foreigners, adding: “There is need that as a nation should take up such projects of national importance.”
#ExxonMobil close to hitting huge #oil #reserves in Pakistan, bigger than #Kuwait’s (100 billion barrels). If the oil deposits are discovered as expected, #Pakistan will be among the top 10 oil-producing countries (#OPEC), ahead of Kuwait in 6th position http://www.arabnews.com/node/1351556#.W2eASM-rU8g.twitter
The US energy giant has drilled up to 5,000 meters near the Pakistan-Iran border, says Pakistan foreign minister
If the oil deposits are discovered as expected, Pakistan will be among the top 10 oil-producing countries, ahead of Kuwait in sixth position
KARACHI: The US energy giant ExxonMobil is close to hitting huge oil reserves near the Pakistan-Iran border, which could be even bigger than the Kuwaiti reserves, says Abdullah Hussain Haroon, Pakistan’s caretaker minister for maritime affairs and foreign affairs.
ExxonMobil, the American multinational oil and gas company, has so far drilled up to 5,000 meters close to the Iranian border and is optimistic about the oil discovery, Haroon told business leaders at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI).
If the oil deposits are discovered as expected, Pakistan will be among top the 10 oil-producing countries ahead of Kuwait in sixth position.
Kuwait’s oil reserves make up 8.4 percent of the oil reserves in the world. Kuwait claims to hold about 101.50 billion barrels, including half of five billion barrels in the Saudi-Kuwaiti neutral zone which Kuwait shares with Saudi Arabia.
According to current estimates, 81.89 percent of the world’s proven oil reserves are located in OPEC member countries, with the bulk of OPEC oil reserves in the Middle East, amounting to 65.36 percent of the OPEC total, latest OPEC data shows.
Pakistan’s foreign minister also said that his government has already taken an undertaking from ExxonMobil to set up a generation complex worth $10 billion.
“They are also putting up an LNG berth at Port Qasim, the second seaport in Karachi. They have already paid for the drilling rights in Pakistan,” Haroon added.
He said: “Pakistan is providing a level playing field to foreign investors and they are interested in coming to Pakistan. What we need to do is to meet their standards and attract them to make investment.”
In May 2018, the ExxonMobil had acquired 25 percent stakes in offshore drilling in Pakistan. The agreement was signed at Prime Minister’s Secretariat among ExxonMobil, Government Holdings Private Limited, PPL, Eni and the Oil and Gas Development Corporation.
The agreement has reduced the drilling share of other partner exploration companies to 25 percent each.
Haroon said that Pakistan is being dragged into the US-China trade war but “the country is maintaining its impartiality.”
“When we sought a much-needed external loan from China, which they initially had refused, the US expressed its annoyance,” Haroon added.
Pakistan currently meets only 15 percent of its domestic petroleum needs with crude oil production of around 22 million tons; the other 85 percent is met through imports. The country facing huge current account deficit of up to $18 billion is spending a substantial amount of foreign exchange reserves on import of oil. The import bill of Pakistan rose by to $12.928 billion in the July-May 2017-18 period of the last fiscal year.
Pakistan’s foreign minister also talked about the current water crisis and its impact on Indo-Pak relations. “India is acting to control water flows which would endanger Pakistan’s food security and they would ruin our crops,” he said.
Haroon called for the integration of Karachi Port and Port Qasim so that they could supplement each other in the larger interest of the country.
Minister Hussain Haroon denies quote about big oil find by Exxon Mobile in Pakistan
http://api.ning.com/files/921Jqs6UN3FtycsxGzvMNFrEGJCbffL*e7AXLZAoUQpBwaSMmX4GXNAVYvna-PrWqJD1aKn6xJi31JfnDE0Z8aoqqgcZ6K4f/IMG_0171.JPG
I remember since my childhood I have heard that there is lots of Oil in Balochistan but certain forces dont allow us to drill.
Talk about wishful and delusional thinking.
Two years ago Pak engineers invented a car that runs on water instead of petrol. The genius engineers even made it to different TV shows. It shows how desperate and eager people are to believe anything to help them out of despair they find themselves in.
Even highly educated people get into the euphoria of fake news instead of using their Aqal.
Masood: "Even highly educated people get into the euphoria of fake news instead of using their Aqal."
There’s a thing called “technology” that has dramatically changed in the last 20 years...and that applies to oil and gas industry as well.
There was no shale oil or gas a few years ago and now there’s lots it. You couldn’t drill more than a mile but now you can drill a lot deeper and access reserves hidden deep onshore and offshore
#Pakistan #Oil #Gas Exploration Company profit up 23% in FY2018: #OGDCL, #ExxonMobil, #ENI, #PPL plans ultra-deepwater #offshore drilling in #Arabian Sea in January 2019 https://www.thenews.com.pk/print/365295-company-profit-up-23-percent-in-fy2018-ogdcl-plans-ultra-deepwater-offshore-drilling-in-january-2019
The Oil and Gas Development Company (OGDC) on Friday said drilling in its ultra-deepwater offshore block is expected to start next year as the company has completed seismic work.
“… work on ultra-deepwater offshore well has been approved and the rig has been arranged, where work will start from January 2019, which will take about 4-5 years to develop,” a senior company official said at analysts briefing.
The briefing as arranged after an announcement of the company’s financial results for the year 2017/18.
Industry officials said a joint venture comprising OGDC, Pakistan Petroleum Limited (PPL), ENI and ExxonMobil, have planned drilling of the first exploratory well Kekra-1 in offshore Indus G-Block with a total investment of $70 million.
Pakistan’s oil and gas sector witnessed a major development recently when the world’s largest energy company ExxonMobil acquired 25 percent stake in Pakistan’s offshore Indus G block. This development could be seen as a major breakthrough as it might lead other international energy firms to bring foreign investment in Pakistan’s energy sector.
Indus G block is approximately 7,500 square kilometres located in ultra-deep water offshore Pakistan. ENI is the operator of the block. OGDCL officials said Tal block pricing case is in the court and the new government is willing to discuss all existing issues.
The issue is expected to be settled in FY19, they said.
OGDCL sees stagnant growth in gas production as “a challenge”.
In the next two years, the OGDC should be able to come up with 150mmcd of gas.
“With natural depletion and incremental gas production, the company will be able to sustain its gas production at current levels going forward,” the company’s official said.
Profit of the company increased 23 percent in the year ended June 30, 2018, compared with the preceding year. This was on the back of higher crude oil prices and growth in sales.
Oil price hike and rupee depreciation lifted profit of Oil and Gas Development Company Limited (OGCL) up a decent 23 percent at Rs78.736 billion during the financial year ended June 30, translating into earnings per share (EPS) of Rs18.31.
OGDCL’s profit amounted to Rs63.803 billion with EPS of Rs14.83, the company said in a filing with the Pakistan Stock Exchange.
The company announced a final cash dividend of Rs2.5/share, taking full-year payout to Rs10/share.
Overall receivables due to circular debt have increased, but at the same time, cash position of the company has strengthened.
Brokerage First Capital Equities Limited said sales jumped 19 percent to Rs205.335 billion in FY2018.
Benchmark Arab Light oil prices advanced 28.4 percent to average $62.3/barrel in FY2018. Rupee depreciated around five percent during the financial year.
Sales increased despite falling hydrocarbon volumes during the year.
“Exploration expense came in at Rs16.19 billion above our forecasted figure of Rs14.94 billion due to recording of a previously-suspended well at Ranipur, while quantum of other income stayed at the previous year’s level,” First Capital Equities said in a flash report.
OGDCL said the company recorded significant increase in seismic efforts and drilling activities during the year. The company paid Rs33.890 billion on the account of taxes.
Analyst Ahsan Arshad at Taurus Securities exploration cost rose 22 percent year-over-year as the company booked 11 dry wells as against four dry wells in the corresponding year.
Analyst Aftab Awan at Sherman Securities said the gross margin of the company improved to 59 percent in FY2018 from 55 percent in FY2017 mainly due to improved oil and gas prices and reduction in operating costs.
Can Exxon Mobil entry bring foreign investment into Pakistan’s energy sector?
http://english.alarabiya.net/en/business/energy/2018/11/04/Can-Exxon-Mobil-entry-bring-foreign-investment-into-Pakistan-s-energy-sector-.html
Finalizing the agreement, Exxon Mobil, PPL, ENI, OGDC and Government Holdings Private Limited (GHPL) representatives got together at the Prime Minister’s Secretariat just before the general elections were held in Pakistan.
During the next few months, these companies conducted a study and singled out potential areas for drilling activity. Planning to invest $70 million in the joint venture, the four companies finally decided to kick off the first exploratory well Kekra-1 in offshore Indus G-Block.
Around 7,500 square kilometers in span, the Indus G block is in ultra-deep waters offshore Pakistan and has been one of the most promising blocks, in recent years it was operated solely by ENI. Planning the first exploration well assignment in January 2019, ENI would also lead this joint venture as it has had continued presence in Pakistan.
Nevertheless, no commercially viable discovery took place in the last five decades and it all began in 1963 when an American company drilled three wells for the very first time near Pakistan’s shores and discovered no hydrocarbons. Subsequently also, all attempts have given negative results. Ostensibly, even the last offshore well Shark -1 drilled by ENI and PPL gave no positive results.
Additionally, even if a big discovery is made, it takes years to set up the appropriate infrastructure to commence production. This time round, however, the USAID conducted a study after collecting data from 1611 wells and came up with a favorable assessment. Even the US Energy Information Administration (EIA) figures regarding Pakistan have been positive in both 2011 and 2013 estimates.
Consequently, hopes are high as ENI contracts a ship for the drilling, which will now start in early December this year. The ENI has chartered a drillship from Saipem, the contract starts from 1st December this year and may be planning to ‘spud’ the Kekra-1 exploration well in the block in January 2019.
According to Offshore Energy Today, it received an email confirming the deal with Eni and a Saipem spokesperson said that, “We can confirm that Saipem 12000 is working for Eni in Pakistan.”
There was no further information about the scope of the work but it looks like the rig Saipem 12000 will be used to drill in the offshore Indus G-Block as the timing also matches.
Located nearly 280 km from the city of Karachi, the usual constraints for this exploratory site Kekra -1 are that suitable drilling times are from December to April and Karachi port is used for operations. Following the recent surveys undertaken, the prospects look bright and there are great expectations regarding this offshore drilling.
Discussing the project, OGDCL Managing Director Zahid Mir said: “The block has very high prospects, and exploratory well Kekra-I has strategic importance for the region as we are expecting a multi-billion cubic feet of gas flows from the block.” Notably, he remarked that, “If a success, this would be a game changer for the country as well as the entire region.”
Predictably, the interest of major oil companies should increase as the project commences and brings in foreign investment for Pakistan’s energy sector.
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Update: Eni charters Saipem 12000 for Pakistan drilling
Eni has chartered Saipem’s drillship ‘Saipem 12000″ for work in Pakistan for an undisclosed dayrate.
https://www.offshoreenergytoday.com/report-eni-charters-sapiem-12000-for-pakistan-drilling/?fbclid=IwAR0O9Eokz1bH1VQy1xASWs18Aa2RGx4aw0vrtWGW3exX3yJGqeUdYNOk5Pw
How America Broke #OPEC With New #Technologies. #American output is rising at the fastest rate in a century. Earlier this year the U.S. eclipsed #SaudiArabia and #Russia as the world’s largest #oil producer. #fracking #deepwater drilling https://www.wsj.com/articles/how-america-broke-opec-11544831785 via @WSJOpinion
U.S. crude production has surged 20% in a year and nearly tripled in a decade thanks to advances in hydraulic fracturing and horizontal drilling. American output is rising at the fastest rate in a century. Earlier this year the U.S. eclipsed Saudi Arabia and Russia as the world’s largest oil producer.
For nearly six decades OPEC has dominated oil markets by setting production quotas among its 15 members. In late 2014, OPEC flooded the market with oil in an effort to break U.S. drillers who were burning cash on mounds of debt. As oil prices fell below $40 a barrel in 2015-2016, many wildcatters folded or were absorbed by larger producers.
But the survivors became more efficient. Technology—including drones with thermal imaging to detect leaks along with improvements in horizontal drilling—boosted productivity. Over the last five years production per rig has more than tripled in the Permian Basin and quadrupled in North Dakota’s Bakken Shale. While the Bakken rig count has fallen by 70%, output has increased by a third.
Most American oil refineries have processed heavier crudes, which depressed prices for lighter, sweeter grades produced in the new wells. But in late 2015 the GOP Congress expanded shale-oil’s market by lifting the export ban on crude in return for Barack Obama’s demand to extend renewable energy tax credits. U.S. crude exports have since soared to 3.2 million barrels a day.
Many U.S. producers say they can turn a profit at $50 a barrel and even as low as $30 in the Permian’s most productive regions. Yet most OPEC members need prices ranging between $70 and $90 per barrel to balance their budgets. The cartel scaled back output in 2016, but shale producers roared back as prices recovered. America’s shale gusher has presented a quandary for OPEC and especially its largest member, Saudi Arabia, which faces large budget deficits as it works to contain Iranian influence in the Middle East.
Earlier this year, the Saudis obliged President Trump by increasing output to prevent prices from soaring with the reimposition of U.S. sanctions on Iran. Even so oil prices hit a four-year high in early October. But they have since declined 30% amid weakening world economic forecasts, sanctions exemptions and surging U.S. production.
OPEC and Russia last week agreed to scale back production collectively by 1.2 million barrels a day, but the meeting exposed the cartel’s cracks. Qatar quit amid hostilities with the Saudis. Small producers carped they were too insignificant to affect global supply. Algeria produces one million barrels per day, which is as much as U.S. output has increased in five months.
Saudi Arabia, Russia and allied producers agreed to shoulder the bulk of the cuts while Libya, Iran and Venezuela received exemptions. Some in the media claim the Saudis defied Mr. Trump’s pleas to keep oil prices low, yet U.S. shale producers are likely to benefit from OPEC’s cuts by capturing more market share.
One of the biggest constraints on U.S. production has been a distribution bottleneck. Hence West Texas Intermediate now sells at a $8 to $9 discount to Brent crude on the world market. But next year three pipelines capable of delivering two million barrels of Permian crude to the Gulf Coast are expected to come online. In 2020 two more pipelines that can carry two million barrels a day are expected to be completed.
Oil companies are also racing to build more export terminals to handle the supply gusher, which isn’t likely to stop anytime soon. The U.S. Geological Survey reported recently that the Permian’s Delaware Basin holds more than twice as much oil and 18 times as much natural gas as the heavier-drilled Midland region.
#Pakistan #ExxonMobil offshore drilling site #Kekra-1 143 miles from #Karachi is among top 3 potential "big oil finds" in #Asia
https://www.bloomberg.com/news/articles/2019-01-14/oil-wildcats-to-watch-for-signs-of-asia-drilling-drop-reversal
“Explorers are getting a little bit more ambitious in this part of the world,” Andrew Harwood, the consultancy’s Asia-Pacific upstream research director, said in an interview in Singapore. “These are huge companies with global portfolios; they’re not spending the money to drill unless they have a reason to be excited.”
Wood Mackenzie expects mergers and acquisition spending in the region to total about $8 billion in 2019 after growing 60 percent to $8.7 billion 2018. Activity will be focused around divestments in Southeast Asia by companies that want to focus spending on U.S. shale.
Here’s a closer look at the three Asia-Pacific prospects Wood Mackenzie is paying the most attention to:
Pakistan
A group including Eni SpA and Exxon Mobil Corp. will start drilling the Kekra-1 well this month in deepwater south of Pakistan. The country’s onshore natural gas production has been declining after years of under-investment, leading to the start of liquefied natural gas imports in recent years. Growing demand for the fuel has made the drillers more confident that they’ll be able to sell any gas from a sizable development, Harwood said.
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Pakistan: ExxonMobil Begins Drilling off Karachi Coast
https://worldview.stratfor.com/situation-report/pakistan-exxonmobil-begins-drilling-karachi-coast
What Happened: ExxonMobil has begun drilling for oil and gas 143 miles off the coast of Karachi in the Arabian Sea, Daily Pakistan reported Jan. 10.
Why It Matters: The operations mark the first time an energy company is conducting offshore exploration along Pakistan's coast. An ExxonMobil executive has said the company has been considering launching operations in the region because of Pakistan's growing energy demand.
Background: Only 15 percent of Pakistan's energy consumption is met by domestic production. High energy prices have significantly inflated the country's import bill and contributed to draining its foreign exchange reserves.
#Pakistan may soon hit #oil , #gas jackpot in offshore drilling in Arabian Sea off the coast of #Karachi by Exxon: #PMImranKhan - Pakistan - http://DAWN.COM
https://www.dawn.com/news/1471138
Prime Minister Imran Khan on Thursday indicated that Pakistan was on the verge of hitting a kind of jackpot in the form of discovering a huge reserve of oil and gas.
“Just pray that our hopes and expectations from the offshore drilling being carried out by the ExxonMobil-led consortium prove to be true,” he said.
“There’s already been a delay of about three weeks, but if the indications we are getting from the companies are anything to go by, there’s a strong possibility that we may discover a very big reserve in our waters. And if that happens, Pakistan will altogether be in a different league,” he said.
In an informal chat with a group of newspaper editors and other senior journalists, Mr Khan didn’t share details of the offshore drilling process. And there has been no official word from ExxonMobil and the international oil exploration company ENI which have been involved since January in drilling an ultra-deep well (230km inside the sea) for oil in what is known as Kekra-1 area.
ExxonMobil returned to Pakistan after nearly a decade after surveys were carried out last year suggesting the possibility of big oil reserves within the Pakistani waters.
----------------
In a new development, the drilling activities that kicked off with the budget of $75-80 million by joint venture headed by ENI in Kekra-1 well in Indus G Block located in Pakistan’s deep sea has braved a blow of mud loss owing to which investment on drilling is feared to touch the staggering figure of $100 million. The drilling had started with the hope of good news in the months of March and April.
EXXON Mobile is drilling the well and it was given the target to drill the Kekra-1 well by 5,800 metre deep in March, but when the drilling reached by 4,900 metres, a huge kick pressure was felt owing to which the process braved the mud loss, a relevant official at Petroleum Division told The News.
Drilling process has braved a blow of mud loss owing to which investment on drilling is feared to touch the staggering figure of $100 million Exxon Mobile, OGDCL and Pakistan Petroleum Limited (PPL) are the partners of the Joint Venture headed by ENI The discovery is anticipated to yield gas flows which can be as big as Sui field
Addition Secretary and spokesman of Petroleum Division Sher Afgan confirmed that during the drilling activities, exploration companies sustained mud loss during the ongoing drilling of Kekra-1. However, he said that the sign of kick pressure is good as it determines that something is in the well.
https://www.thenews.com.pk/print/447339-drilling-activities-in-pak-kekra-1-well-sustains-blow-of-mud-loss
In a new development, the drilling activities that kicked off with the budget of $75-80 million by joint venture headed by ENI in Kekra-1 well in Indus G Block located in Pakistan’s deep sea has braved a blow of mud loss owing to which investment on drilling is feared to touch the staggering figure of $100 million. The drilling had started with the hope of good news in the months of March and April.
EXXON Mobile is drilling the well and it was given the target to drill the Kekra-1 well by 5,800 metre deep in March, but when the drilling reached by 4,900 metres, a huge kick pressure was felt owing to which the process braved the mud loss, a relevant official at Petroleum Division told The News.
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He said that mud loss means the loss of special chemicals used in the drilling process and because of this development, the exploration companies will have to again spud the well by 1500 metres. Keeping in view the new development, now the exploration companies have started side tracking process to continue its drilling process.
Addition Secretary and spokesman of Petroleum Division Sher Afgan confirmed that during the drilling activities, exploration companies sustained mud loss during the ongoing drilling of Kekra-1. However, he said that the sign of kick pressure is good as it determines that something is in the well.
Exxon Mobile, OGDCL and Pakistan Petroleum Limited (PPL) are the partners of the Joint Venture headed by ENI. Pakistan is eying massive oil and gas recovery in Kekra-1 well.
The Indus G Block was first given to OGDCL on August 12, 2006 but later on it was transferred to ENI on April 25, 2007 under Petroleum Sharing Agreement. Now the ENI as operator of four companies’ joint venture has started E&P activities in Pakistan deep sea. In case of huge discovery, Pakistan’s share in oil and gas discovery can go up to 70 percent depending upon the slabs mentioned in the agreement.
The country at present possesses original onshore recoverable gas resources of 57 trillion cubic feet (tcf) out of which 38tcf has been produced and 19.5 tcf is yet to discovered. The country has recoverable resources of oil that stands at 1.246 billion barrels but so far 0.899 billion barrels have been produced so far. In March, Exxon Mobil will send a specimen to Houston for examination. Similarly, ENI will send the specimen to Milan in March. From April to May, there will be a reasonable idea that this well contains oil or gas.
The discovery is anticipated to yield gas flows which can be as big as Sui field, with estimated reserves of 3 to 8tcf, or 25-40 percent of Pakistan’s total gas reserves.
#ImranKhanPrimeMinister has seen high-confidence data indicating large #oil, #gas reserves. There's "kick pressure" from oil/gas in drilling. It was strong kick pressure that forced #ExxonMobil to stop #drilling for more mud to prevent blow-out. #Pakistan https://www.thenews.com.pk/latest/448666-largest-oil-gas-reserves-expected-near-karachi-hopes-pm-imran-khan
#Pakistan #oil good for whole region. Reserves will result in large cross-border capital flows, infrastructure #investment, energy #trades, and people-to-people exchanges. Development/utilization of reserves to be pillar of #economic integration, stability http://www.globaltimes.cn/content/1143525.shtml#.XJuh24zOLig.twitter By Hu Weijia
Pakistan may soon hit the oil jackpot, and that will be good news for not only the country itself but all of South Asia as well as China and Gulf nations.
Pakistani Prime Minister Imran Khan was quoted by local media outlet Dawn as saying that "there's a strong possibility that we may discover a very big (oil) reserve in our waters." If his prediction comes true, the discovery will help the South Asian country tackle its economic problems.
With Pakistan's economy in the doldrums, the cash-strapped country may have a more urgent need for foreign investment if massive oil reserves are indeed discovered. According to Dawn, US oil giant Exxon Mobil and Italy's ENI have been involved since January in drilling an ultra-deep oil well.
There may be more international companies wanting to participate in related projects ranging from exploration to refining and logistics. The related investment will help Pakistan maintain its growth momentum.
China has sound cooperation in energy with Pakistan. A big oil find would stimulate investment enthusiasm among Chinese companies. China is willing to support Pakistan's efforts to seize the development opportunity such a find might bring, and handle any challenges.
The China-Pakistan Economic Corridor (CPEC) was originally conceived as a strategic project with oil and gas pipeline links between Northwest China's Xinjiang Uyghur Autonomous Region and Pakistan's Gwadar port.
If Pakistan discovers massive oil reserves, that will be a motivation to extend Pakistan's pipeline network further into Iran and India, and also to enhance energy cooperation with Gulf nations such as Saudi Arabia.
Not only China but also the whole region will benefit from economic integration through energy connectivity.
Using those reserves will likely result in large cross-border capital flows, infrastructure investment, energy trades, and people-to-people exchanges. The region will see the development and utilization of oil reserves as a pillar of economic integration and stability.
As for India, Pakistan's potential oil reserves will increase the country's attractiveness for Indian companies, as oil imports rise in India due to higher fuel demand despite bilateral disputes.
The geopolitical picture in Asia has long been complex and uneven, but Pakistan's potential oil reserves are likely be a game-changer for the region, with economic cooperation in energy.
Hopefully India and Gulf nations won't ignore the opportunities to enhance energy cooperation with Pakistan and help fostering an energy network in Asia.
#Pakistan’s massive #oil and #gas discovery report expected in April 2019. Experts believe huge hydrocarbon deposits offshore, enough for 25 to 30 years. Estimated gas reserves are 3 to 8 trillion cubic feet (TCF), 25-40% of country’s total gas reserves. https://gulfnews.com/world/asia/pakistan/pakistans-massive-oil-and-gas-discovery-report-to-be-out-in-april-1.62968777
Dubai: Pakistan will announce the discovery of massive oil and gas reserves in the next three weeks, said an official.
A consortium of four leading companies led by US-based ExxonMobil, which has started drilling in ultra-deep waters offshore Karachi, is likely to submit its report by April, Pakistan’s official news agency APP reported on Thursday.
The consortium has claimed it has discovered massive oil and gas reserves offshore Indus G-Block called Kekra-I some 230-km off the Karachi coast.
Gulf News earlier reported that the location of the reserves is near Iran borders. On Monday, Pakistan Prime Minister Imran Khan had also hinted at finding ‘massive’ oil reserves off the coast of Karachi.
He said he would soon share good news with the nation. He had said Pakistan would not need to import oil after the offshore reserves are found.
“Steady drilling is in progress and there are ‘good symptoms’ about the success of the project. Currently, more than 4,000 metres of vertical drilling has been completed. Drilling is under way horizontally against the target of around 5,500 metres,” the official said.
Experts believe that there are huge hydrocarbon deposits, sufficient for the country’s needs for 25 to 30 years. The energy scarce nation is anxiously waiting for good news.
The official said exploration activity is continuing round-the-clock by a highly skilled team of more than 200 professionals with periodical tests of specimens conducted after almost every 1,000-metre drill.
The well’s diameter is 18 to 24 inches and companies had set the target depth of 5,500 metres, the official said, adding that the discovery is anticipated to yield gas flows which could be ‘as big as Sui field’. Estimated reserves are three to eight trillion cubic feet (TCF), or 25-40 per cent of the country’s total gas reserves.
The official said the country is in dire need of a big discovery as existing hydrocarbon reserves are depleting fast and its reliance on imported gas and oil is increasing with each passing day.
According to data of a recent study, existing deposits in Pakistan will further deplete 60 per cent by the year 2027. It underlined the need to step up exploration in potential areas on a war-footing.
The offshore drilling is a joint venture of ENI, Exxon Mobil, Oil and Gas Development Company Limited and Pakistan Petroleum Limited. In December 2018, Exxon Mobil had announced that it would reinvest in the Pakistani market after a gap of nearly three decades.
According to media reports, if oil deposits are discovered as expected, Pakistan will be among top 10 oil-producing countries.
Pakistan currently meets only 15 per cent of its domestic petroleum needs with crude oil production of around 22 million tons; the other 85 per cent is met through imports.
The country is facing a huge current account deficit of up to $18 billion and is spending a substantial amount of foreign exchange reserves on import of oil. The import bill of Pakistan rose by to $12.928 billion in the July-May 2017-18 period of the last fiscal year.
2019 #Oil and #Gas Exploration Off to Flying Start. Eni’s Kekra well in #Pakistani waters has pre-drill prospective resource estimates of 1.5 billion barrels of oil equivalent. #exxonmobil #Pakistan #offshore | Rigzone https://www.rigzone.com/news/2019_oil_and_gas_exploration_off_to_flying_start-08-apr-2019-158543-article/?utm_source=GLOBAL_ENG&utm_medium=SM_TW&utm_campaign=SHARE_DESKTOP via @rigzone
Oil and gas exploration is off to a flying start in 2019, according to independent energy research and business intelligence company Rystad Energy.
Global discoveries of conventional resources in the first quarter reached 3.2 billion barrels of oil equivalent (boe), Rystad revealed Monday in a statement sent to Rigzone. Most of the gains were recorded in February, which saw 2.2 billion barrels of discovered resources, Rystad highlighted.
Majors reported more than 2.4 billion boe of the discovered resources for the quarter, Rystad outlined in the statement. ExxonMobil was the most successful, with three offshore discoveries accounting for 38 percent of total discovered volumes.
“If the rest of 2019 continues at a similar pace, this year will be on track to exceed last year’s discovered resources by 30 percent,” Rystad Upstream Analyst Taiyab Zain Shariff said in the company statement.
The total volume of global conventional discoveries in 2018 was 9.1 billion boe, according to Rystad. Total global conventional discoveries were 10.3 billion boe in 2017 and 8.4 billion boe in 2016.
No Signs of Slowing Down
In the statement, Rystad said the push for “substantial” new discoveries shows no signs of slowing down, with another 35 “high impact” exploration wells expected to be drilled this year, both onshore and offshore.
Rystad highlighted that three such wells are already underway; the Shell-operated Peroba well off Brazil - with pre-drill prospective resource estimates of 5.3 billion boe, Eni’s Kekra well in Pakistani waters -with pre-drill prospective resource estimates of 1.5 billion boe and the Total-operated Etzil well off Mexico -with pre-drill prospective resource estimates of 2.7 billion boe.
“If these wells prove successful, 2019’s interim discovered resources will be the largest since the downturn in 2014,” Shariff stated.
Earlier this year, Rystad said improved market conditions and lower well costs had led exploration and production players to “ramp up” their 2019 exploration activities in all parts of the world.
“Renewed optimism in exploration activities is anticipated in 2019, with operators from various segments aiming for multiple high-impact campaigns – both onshore and offshore – in essentially all corners of the world,” Rystad Energy Senior Analyst, Rohit Patel, said in a company statement back in February.
“These include wells targeting large prospects, play openers, wells in frontier and emerging basins and operator communicated high impact wells,” Patel added.
Rystad is headquartered in Oslo and has locations in Houston, Singapore, London, New York, Sydney, Moscow, Stavanger, Rio de Janeiro, Tokyo, Dubai and Bangalore. The company traces its roots back to 2004.
More delay in #Pakistan offshore drilling due to concerns about blow-out from huge #oil and #gas field estimated to have to over 1.5 billion barrels of oil. Exxon fixing blow-out preventer (BOP) to prevent oil fire from blow-out from kick pressure #Karachi https://www.thenews.com.pk/print/462934-kekra-drilling-process-hits-another-snag
The spudding, that was to kick start on April 20, 2019 at Kekra-1 well in G-bloc, Pakistan’s ultra-deep sea after pause of 12 days, could not take off as it has hit another serious snag.
The blow out preventer (BOP) that prevents from any blow out or any kick pressure that can result into eruption of fire, has gone out of order and its repair is underway.
Sher Afgan, Additional Secretary and spokesman for Petroleum Division, confirmed the development saying the blow out preventer that is attached with valves at the end of rig has developed serious problems owing to which the drilling could not start on time.
Up till now, the official said, drilling is virtually stopped for the last 18 days and the status will last till the repair process of BOP is completed. However, Ghulam Mustafa, expert of oil and gas exploration and production, did not accept that the blow out preventer takes four to five days for repair, arguing that the BOP cannot be repaired, rather it can be upgraded by changing its affected spare parts and this process does not take more than one hour. He said the drilling machine may have developed other problem that is not being shared.
Earlier, the drilling got stalled on April 8 at the depth of 4,810 meters because of cementing and casing process which took almost 12 days to get completed. Now the issue of blow out preventer has emerged which according to the official of Petroleum Division is being coped with. And once the BOP’s repair is completed, the Mobile Exxon with ENI as operator at Kekra-1 well will start the drilling of the remaining 650-800 meters under second side tracking.
GA Sabri, former secretary of Petroleum Ministry, opined that BOP is one of the important tools that prevents the rig and whole apparatus from any blow out that is caused because of pressure kick that also may lead to eruption of fire. He said that BOP ensures the safety of the machine (rig and whole apparatus). When asked what will happen to the drilling as in May, the sea will turn rough because of high tide, Sabri said according to new weather forecast, monsoon has delayed so the chances of sea to turn rough have got minimised in May which is a good news.
Once the BOP issue is sorted, Kekra-01 well will enter a phase where the operator will, for the first time, begin to receive information that would help determine the well prospects. This would include results from LWD (logging while drilling), salinity testing, potential hydrocarbon traces in mud and rock samples and hydrocarbon kicks.
Time required to drill the remaining depth will depend upon the rate of penetration (RoP). The penetration rate is significantly slower for northern region of Pakistan than the southern region.
“We don’t yet have precedents to form a reliable estimate for the RoP for offshore Indus-G, where Kekra-01 is being drilled. An RoP of 10 meters per hour (generally considered low) would mean that it would take 80 hours or a little more than three days to reach the target depth.’’
After completion of drilling, the operator will likely do wire line logging which could take another three or four days. This will likely be followed by another casing and cementing exercise that can take four to six days. At this stage a substantial amount of information regarding the well prospects will be known, however, the results (discovery or dry well) will require completion of proper testing.
160 oil and gas reservoirs discovered in Pakistan in last 10 years
https://dnd.com.pk/160-oil-and-gas-reservoirs-discovered-in-pakistan-in-last-10-years/165344
ISLAMABAD, Pakistan: The Minister for Energy (Petroleum Division) Omar Ayub Khan has said that a total of 160 oil and gas reservoirs have been discovered in Pakistan during the last 10 years.
In a written reply submitted in the National Assembly, Omar Ayub said that the discovered reservoirs are in different stages of appraisal and development, therefore, the estimated volume and value may vary based on actual production and its recovery factor.
The province wise break up of aforesaid discoveries during the year 2008-2018:160 oil and gas reservoirs discovered in Pakistan in last 10 years
Furthermore, the minister for energy told the House that at present total annual requirement of oil of the country is around 25.8 million tons per annum.
Required purchase and sale rates of petroleum products in Pakistan:
The minister said that the prices of petroleum products in the Country are linked with the International Arab Gulf market prices which fluctuate on daily basis and not in the control of government. Accordingly, the domestic oil prices are increased/decreased by including notified taxes and other cost components incurred on the supply of oil across the country.
Omar Ayub said that the government takes steps from time to time for providing relief to the consumers by adjusting any hike in international oil prices through reduction in the rate of taxes.
Pakistan light oil pipeline project undertaken by CPP completed
http://en.ce.cn/Insight/202206/13/t20220613_37750580.shtml
FAISALABAD, Jun. 13 (Gwadar Pro) –Recently, the MFM MoGas Project – (MFM MP) Phase-II (TS-3 & TS-4), constructed by China Petroleum Pipeline Engineering Co., Ltd. (CPP) was officially completed and successfully passed the owner's inspection.
“Since we officially entered the Pakistani market in July 2014 and registered the Pakistan Branch of China Petroleum Pipeline Engineering Co., Ltd. in October 2017, we have completed a total of 9 projects here. Beyond all question, the light oil pipeline project means another challenge for us," said Wang Desheng from the TS-3 & TS-4 EPC Project Department in an exclusive interview with Gwadar Pro.
“Our owner, Pak–Arab Refinery Limited (PARCO), operates a pipeline transportation system of more than 2,000 kilometers, from Karachi in the south to Lahore in the north, which can be described as the main artery that helps Pakistan’s north-south energy transmission. In recent years, demand for motor gasoline has grown rapidly in north and central Pakistan, so the PARCO started planning to use the same pipeline to transport gasoline to alleviate the shortage in the region, thereby stabilizing its market share in north-central Pakistan,” Wang told Gwadar Pro, “therefore, Mahmood Kot-Faisalabad-Machike (MFM) Pipeline Phase II Reconstruction and Expansion Project came into being, which also included our project.”
The TS-3 and TS-4 stations are located in Faisalabad and Sheikhupura, Punjab, respectively. The former includes a single gasoline storage tank (42 meters in diameter, 12.6 meters in height, and a tank capacity of 15,000 cubic meters), a fire water storage tank (15.24 meters in diameter, 13.1 meters in height and a tank capacity of 2200 cubic meters), etc. The latter includes 2 single gasoline storage tanks (42 meters in diameter, 12.6 meters in height and a tank capacity of 15,000 cubic meters), a fire water storage tank (18.2 meters in diameter, 14.63 meters in height and a tank capacity of 3500 cubic meters) and related supporting facilities.
According to Wang, their project has always adhered to the strictest engineering quality standards since the start of construction in November 2017 until the owner issued the completion certificate recently. “During the construction period of several years, our team overcame challenges such as local climate, customs differences, project safety, and successfully overcame the huge difficulties brought by the COVID-19 epidemic, and the project proceeded smoothly. It can be said that the owner's affirmation means our success,” Wang emphasized.
Besides, as for employment, the project also created a series of jobs to local technical talents. The reporter learned that during the peak construction period, the total number of people on site reached nearly 400. The project department recruited a group of skilled and experienced Pakistani engineers, and the person in charge of HSE also provided training on epidemic prevention and various rules and regulations.
In Wang’s view, there are huge opportunities for cooperation between CPP and Pakistani companies in the oil and gas industry, which has a considerable market in Pakistan. At present, the CPP has established good cooperative relations with major oil and gas industry owners such as SSGC, SNGPL, PARCO, ISGS, OGDCL, etc. in Pakistan, and has won a good reputation locally. “In the future, we will always pay attention to local policy trends and seize the opportunity to promote the comprehensive development of large-scale oil and gas projects in the China-Pakistan Economic Corridor. China-Pak friendship Zindabad!”
A significant deposit of petroleum and natural gas has been discovered in Pakistan's territorial waters, with estimates suggesting it could be the fourth-largest oil and gas reserve globally.
https://www.cnbctv18.com/world/pakistan-finds-oil-that-may-change-its-destiny-natural-gas-petroleum-19472606.htm
The discovery, verified through a three-year survey in collaboration with a friendly nation, holds the potential to dramatically alter Pakistan's economic fortunes, according to a senior security official quoted by DawnNewsTV.
The extensive geographic survey has pinpointed the location of the deposits, with relevant departments informing the government. The survey marks the beginning of what officials are calling an initiative to benefit from the ‘blue water economy’, which includes not only oil and gas but also other valuable minerals from the ocean.
Proposals for exploration and bidding are under review, but actual extraction may take several years. The process of digging wells and extracting the oil and gas could be a long-term endeavour, requiring further investments and infrastructure development.
Challenges ahead
Former Oil and Gas Regulatory Authority (Ogra) member Muhammad Arif struck a more cautious note, reminding stakeholders that while optimistic, there is never a guarantee the reserves will meet expectations.
He explained that exploration requires a substantial investment of around $5 billion, and extracting the reserves could take up to five years.
The Chinese side expressed its willingness to strengthen cooperation with Pakistan in such areas as offshore oil and gas resources, and natural gas hydrate. The Chinese side would encourage Chinese companies to actively participate in the development of offshore oil and gas blocks of Pakistan.
http://losangeles.china-consulate.gov.cn/eng/topnews/202406/t20240609_11415903.htm#:~:text=The%20Chinese%20side%20expressed%20its,and%20gas%20blocks%20of%20Pakistan.
Joint Statement between the People’s Republic of China and the Islamic Republic of Pakistan
2024-06-09 10:43
June 7, 2024, Beijing
1.At the invitation of H.E. Li Qiang, Premier of the State Council of the People’s Republic of China, H.E. Muhammad Shehbaz Sharif, Prime Minister of the Islamic Republic of Pakistan paid an official visit to China from June 4 to June 8, 2024.
2.During the visit, H.E. Xi Jinping, President of the People’s Republic of China met with Prime Minister Sharif. Prime Minister Sharif held talks with Premier Li Qiang of the State Council, and met with H.E. Zhao Leji, Chairman of the Standing Committee of the National People’s Congress. The two sides had candid and in-depth exchanges of views on the entire spectrum of bilateral relations as well as regional situation and international landscape and reached extensive consensus on further strengthening the China-Pakistan All-Weather Strategic Cooperative Partnership and promoting practical cooperation in various areas, and on international and regional issues of mutual interest.
3.The two sides agreed that China and Pakistan are All-Weather Strategic Cooperative Partners and ironclad friends, and the two countries have always understood, trusted and supported each other. Since the establishment of diplomatic ties 73 years ago, China-Pakistan relations have stood the test of changing international environment and have been as solid as a rock, and as unshakable as a mountain. The Chinese side reiterated that the China-Pakistan relationship is a priority in its foreign relations. The Pakistani side underscored that the Pakistan-China relationship is the cornerstone of its foreign policy. The two sides enjoy unbreakable strategic mutual trust, fruitful practical cooperation in various fields, and maintain close coordination on international and regional affairs. The two sides would continue to view the relationship between China and Pakistan from a strategic height and a long-term perspective, take effective measures to safeguard the common interests of China and Pakistan, promote socio-economic development and well-being of the two peoples, work together to jointly uphold regional peace, stability, development and prosperity, and accelerate the building of an even closer China-Pakistan Community with a Shared Future in the New Era.
4.The Chinese side congratulated Pakistan on holding successful general elections, and expressed best wishes for the new Pakistani government in leading the Pakistani people in their endeavors to achieve socio-economic development, prosperity, unity, stability and security. The two sides will explore avenues to deepen experience-sharing in state governance and synergize their development strategies.
5.The Pakistani side spoke highly of China's major development achievements in the New Era, and expressed good wishes to the Chinese people that under the strong leadership of the Communist Party of China, China will realize the second centenary goal of building China into a great modern socialist country in every dimension. The Pakistani side spoke highly of and supports China’s all-round efforts to advance the building of a strong country and achieve national rejuvenation through a Chinese path to modernization, believes that the Chinese path to modernization provides a new option and practical solution for developing countries to achieve independent development.
Pakistan’s oil reserves surge 26% as OGDC and MARI report significant upgrades
https://profit.pakistantoday.com.pk/2024/08/20/pakistans-oil-reserves-surge-26-as-ogdc-and-mari-report-significant-upgrades/
Substantial increases in oil reserves bolster the energy sector, with MARI's assets doubling and OGDC seeing major gains despite declines in other fields
Pakistan’s oil and gas sector has received a substantial boost, with the country’s total oil reserves increasing by 26% to 243 million barrels as of June 2024, according to the latest data released by the Pakistan Petroleum Information Service (PPIS).
According to IMS Research, this significant rise is largely driven by notable reserve upgrades in key energy companies, particularly Oil and Gas Development Company (OGDC) and Mari Petroleum Company Ltd (MARI).
OGDC and MARI lead the charge
OGDC reported a 64% increase in its oil reserves, driven by major upgrades in key assets like Kunar and Pasakhi/Pasakhi North, which saw their reserves rise to 10.6 million barrels and 15.15 million barrels, respectively. Despite these gains, OGDC experienced a 30% decline in the oil reserves of its Nashpa field and an 8% reduction in its overall gas reserves due to natural declines in mature fields.
Meanwhile, MARI’s oil reserves have doubled since December 2023, reaching 13.4 million barrels, bolstered by the addition of reserves from the Bannu West (Shewa) field and the Bolan East reserve upgrade. MARI also saw a significant 25% increase in its gas reserves, with the Mari Ghazij field’s reserves surging from 35 billion cubic feet (bcf) to 789 bcf.
Tal Block and PPL show mixed results
The Tal Block, which is crucial to Pakistan Oilfields Ltd (POL), experienced a 10% decline in both oil and gas reserves, attributed mainly to production. Despite these declines, the recent discovery of Razgir-1 is expected to offset some of the reductions, offering a potential uplift in the future.
Pakistan Petroleum Ltd (PPL), however, saw a 6% decrease in its oil reserves and a 4% drop in gas reserves, primarily due to ongoing production activities. The company has managed to stabilize its reserves position through timely workover jobs, which are designed to maximize the life of its existing fields.
The overall modest 2% increase in Pakistan’s gas reserves to 18.5 trillion cubic feet (tcf) is seen as a mixed outcome, given the declines in other major fields. The upgrades in oil reserves, however, particularly for listed exploration and production (E&P) companies like OGDC and MARI, suggest a positive outlook for the sector.
This update is particularly favorable for OGDC and MARI, both of which are poised to see enhanced revenue streams from their bolstered oil reserves. With MARI’s oil reserves now close to those of the Tal Block, the company is expected to further diversify its revenue, reducing its reliance on gas.
As Pakistan continues to navigate the challenges of energy production and reserves management, these developments provide a cautiously optimistic outlook for the country’s energy sector, especially for key players like OGDC and MARI.
Why No Major Oil Company Is Rushing To Drill Pakistan's Huge Oil Reserves | OilPrice.com
Pakistan has discovered potentially massive oil and gas reserves, but experts caution that exploitation will take years and significant investment.
Security concerns and high costs are deterring international oil companies from pursuing exploration in Pakistan, leaving China as the most likely partner for future development.
Despite the discovery, Pakistan continues to face an energy crisis, with Iran reportedly smuggling fuel into the country, further complicating the situation.
https://oilprice.com/Energy/Energy-General/Why-No-Major-Oil-Company-Is-Rushing-To-Drill-Pakistans-Huge-Oil-Reserves.html
A long exploration effort has led to the reportedly massive discovery of oil and gas reserves in Pakistan’s territorial waters, a cache so large that it is said it could change the economic trajectory of the beleaguered country. But no one is rushing to drill in Pakistan, and experts are concerned about jumping the gun.
According to DawnNewsTV, the three-year survey was undertaken to verify the presence of the oil and gas reserves. “If this is a gas reserve, it can replace LNG imports and if these are oil reserves, we can substitute imported oil,’’ former Ogra (Oil and Gas Regulatory Authority) member Muhammad Arif told DawnTv.
However, Arif has cautioned that it would take years before the country could be able to exploit its newfound fossil fuel resources, adding that exploration alone required a hefty investment of around $5 billion and it might take four to five years to extract reserves from an offshore location.
Pakistan covers 29% of gas, 85% of oil, 50% of liquefied petroleum gas (LPG), and 20% of coal requirements through imports, according to the Economic Times. Pakistan's total energy import bill in 2023 clocked in at $17.5 billion, a figure projected to rise to $31 billion in seven years, as per an Express Tribune report. The new discovery is no doubt a big boon for the struggling economy.
Since 2021, Pakistan has been hit with mounting debt and skyrocketing inflation, with inflation hitting nearly 30%. Meanwhile, the economy only expanded 2.4% in 2023, missing the 3.5% target. This has forced the country to rely heavily on foreign aid, which is often elusive. In January this year, Pakistan sought $30 billion for gas production to cut its fuel import bill.
According to Pakistan’s Energy Minister Mohammad Ali, Pakistan has 235 trillion cubic feet (tcf) of gas reserves, and an investment of $25 billion to $30 billion would be enough to extract 10% of those reserves over the next decade to reverse the current declining gas production and replace the import of energy.
The persistently high inflation could push Pakistan over the edge, "There is no precedent in Pakistan’s history of such a long and intense spell of inflation gripping the country," columnist Khurram Husain has written in Dawn.
A Game-Changer? Maybe.
Although Pakistan's hydrocarbon resources are yet to be quantified, some estimates suggest that this discovery constitutes the fourth-largest oil and gas reserves in the world. This could be a potential game-changer in the region’s energy flows.
Back in July, S&P Global Commodity Insights reported that four largely unexplored sedimentary basins in India could hold up to 22 billion barrels of oil. In effect, lesser-known Category-II and III basins namely Mahanadi, Andaman Sea, Bengal, and Kerala-Konkan contain more oil than the Permian Basin which has already produced 14 billion of its 34 billion barrels of recoverable oil reserves.
Why No Major Oil Company Is Rushing To Drill Pakistan's Huge Oil Reserves | OilPrice.com
https://oilprice.com/Energy/Energy-General/Why-No-Major-Oil-Company-Is-Rushing-To-Drill-Pakistans-Huge-Oil-Reserves.html
Rahul Chauhan, an upstream analyst at Commodity Insights, emphasized the potential of India’s unexplored Oil & Gas sector, "ONGC and Oil India hold acreages in the Andaman waters under the Open Acreage Licensing Program (OALP) and have planned a few significant projects. However, India still awaits the entry of an international oil company with deepwater and ultra-deepwater exploration expertise to participate in current and upcoming OALP bidding rounds and explore these frontier regions," he has declared.
Currently, only 10% of India’s 3.36 million sq km wide sedimentary basin is under exploration. However, Petroleum Minister Hardeep Singh Puri says that that figure will jump to 16% in 2024 following the award of blocks under the Open Acreage Licensing Policy (OALP) rounds. So far, OALP has resulted in the award of 144 blocks covering about 244,007 sq km. Under OALP, India allows upstream exploration companies to carve out areas for oil and gas exploration and put in an expression of interest for any area throughout the year. The interests are accumulated thrice a year following which they are put on auction. According to Puri, India’s Exploration and Production (E&P) activities in the oil and gas sector offer investment opportunities worth $100 billion by 2030.
So why is no one rushing to Pakistan to drill?
Shell announced it was selling its Pakistan business stake to Saudi Aramco in June last year, and an auction for 18 oil and gas blocks at the same time last year got a muted response from international bidders, at best. No international companies even bid on 15 of the blocks, according to The Nation.
In July, the country’s Petroleum Minister, Musadik Malik, told a parliamentary committee that no international companies were interested in offshore oil and gas exploration in Pakistan,and those in the country largely had the exit door in view.
It comes down to security, and risk versus reward with Malik explaining to the committee that the cost of security is a major deal-breaker because “in areas where companies search for oil and gas, they have to spend a significant amount to maintain security for their employees and assets”. And security is provided by Pakistan, which has not been up to the task.
In March this year, five Chinese engineers were killed in a suicide attack in Pakistan’s northest, when a vehicle rigged with explosives rammed into a bus transporting staff from Islamabad to the giant Dasu dam project in the Khyber Pakhtunkhwa province. The project is part of the $62-billion China-Pakistan Economic Corridor (CPEC). This incident sparked a series of temporary shut-downs across other projects, as well.
Earlier that same month, insurgents attacked Chinese assets in Pakistan’s southwest, storming the Gwadar Port Authority complex, which is run by China. The attacks were perpetrated by the Balochistan Liberation Army (BLA), separatists fighting for an independent Balochistan, as reported by the Lowy Institute.
Essentially, what this means is that it will be China or bust for Pakistan, as state-owned or state-controlled Chinese explorers have a vastly different appetite for risk. And these massive reserves are not likely to get out of the ground without Aramco showing more desire or the Chinese stepping in, for which discussions are already underway, according to Malik.
In the meantime, Iran is said to be smuggling a billion dollars in fuel into Pakistan every year, as the country’s oil and gas crisis emboldens the black market trade.
USGS: Pakistan Mining Industry 2019
https://pubs.usgs.gov/myb/vol3/2019/myb3-2019-pakistan.pdf
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2018. In fiscal year 2019 (July 1, 2018, through
June 30, 2019), the mining and quarrying sector contributed
2.6% of the GDP and the growth rate of the mining and
quarrying sector was negative 1.96% compared with 7.72% in
fiscal year 2018 (International Monetary Fund, 2020; State Bank
of Pakistan, 2020a, p. 18–19; 2020b, p. 8; 2020d, p. 3).
The total import value in fiscal year 2019 was $54.8 billion
compared with $60.8 billion in fiscal year 2018. The import
value of mineral fuels, oils, and their distillation products was
$16.0 billion; iron and steel, $3.38 billion; articles of iron or
steel, $840 million; and aluminum and articles of aluminum,
$349 million. The total export value in fiscal year 2019 was
$23.0 billion compared with $23.2 billion in fiscal year 2018.
The export value of mineral fuels, oils, and their distillation
products was $477 million; salt, sulfur, lime, and stone,
$463 million; and copper and articles of copper, $269 million
(State Bank of Pakistan, 2020c, p. 123–124).
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In 2019, the production of lignite was estimated to have
increased by 180%; lead (mine, Pb content), by 68%; feldspar,
by 61%; chromium (mine, Cr2
O3
content), by 46%; zinc (mine,
Zn content), by 39%; talc, by 38%; lead (secondary, refinery),
by 33% (reported); soda ash, by 27%; bentonite, by 24%;
kaolin, by 17%; and sand and gravel (industrial, silica), by 12%.
In contrast, the production of fuller’s earth was estimated to
have decreased by 85%; dolomite, by 57%; bauxite, by 49%;
iron oxide pigment, by 47%; magnesite, by 39%; sulfur (native),
by 38%; pumice, by 33%; raw steel, by 30% (reported);
limestone, by 22%; iron (mine, Fe content) and phosphate rock
(gross weight), by 20% each; barite, by 15%; sand and gravel
(industrial, unspecified), by 13%; rock salt, by 12%; and quartz,
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Copper and Gold.—In 2019, Metallurgical Corporation
of China Ltd. (MCC) applied for an extension of its mining
license for the Saindak copper-gold mine, which was set to
expire in 2022. MCC operated the Saindak Mine through a
50%-owned subsidiary, Saindak Metals Ltd. The company
produced 13,049 metric tons (t) of copper (mine, Cu content)
in 2019, which was an increase of 4.1% from the 12,538 t
produced in 2018. MCC mined mainly the south and north ore
bodies using open pit mining; the deposits were expected to be
depleted of minable resources after 2021. The east ore body of
the mine was estimated to have 278 million metric tons (Mt)
of ore and an expected mine life of 19 years. The exports of
copper and articles thereof from Pakistan to China increased to
$550 million in 2019 from $106 million in 2016
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Natural Gas.—Pakistan was in the process of building five
liquefied natural gas (LNG) terminals that were expected to
start operation in 2021 or 2022. The new terminals would triple
Pakistan’s LNG imports and help lessen the gas shortage in
the country. Pakistan had been subject to shortages of natural
gas for power generation, fertilizer production, and household
usages owing to the country’s inability to supply enough gas
from domestic resources, its aged distribution network, and the
difficulty in sourcing LNG cargoes (Nickel, 2019; Abbasi, 2020;
Mohanty and others, 2021).
Petroleum.—Eni Pakistan Ltd. (owned by Eni S.p.A. of Italy,
as operator), Exploration and Production Pakistan BV, Oil and
Gas Development Co., and Pakistan Petroleum Ltd. each held a
25% interest in the Kekra-1 well of the Indus Block G. In 2019,
the consortium ended exploration at the Kekra-1 well after
no reserves of petroleum were found (Hassan, 2019; Rarrick,
2019).
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