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Tag: Mari Petroleum Company Limited

  • Mari Petroleum enters into gas processing contract

    Mari Petroleum enters into gas processing contract

    Mari Petroleum Company Limited (MPCL), a major oil and gas exploration and production company in Pakistan, has signed a Gas Processing Contract with Orient Petroleum Inc (OPI) for the provision of Early Production Facilities (EPF) on a turnkey basis for the Shewa-I Discovery in the Waziristan Block, said a statement issued on Thursday.

    This comes after MPCL announced a gas and condensate discovery at the Shewa-I (formerly Bannu West-l) Exploration Well in the KP Province earlier this year. Under the terms of the contract, OPI will also provide Operations and Maintenance (O&M) services for 24 months from the start of production, with MPCL having the option to purchase the EPF equipment.

    MPCL is the operator of the Waziristan Block with a 55% working interest, while OGDCL and OPI are joint venture partners with a working interest of 35% and 10%, respectively. The EPF will be crucial in processing the gas and condensate for commercial use, and OPI’s expertise in providing these services will help ensure efficient and safe production.

    The gas and condensate discovery at Shewa-I has been a significant development for MPCL, as it contributes to the country’s growing energy demands. In addition to Shewa-I, MPCL also made a gas and condensate discovery in the Bannu West Block earlier this year.

    MPCL is committed to the development of Pakistan’s oil and gas resources, and partnerships with companies like OPI are key in maximizing the potential of these reserves. The gas processing contract is expected to help MPCL move towards full-scale commercial production of the reserves in the Shewa-I Discovery, further contributing to Pakistan’s energy security.

  • Mari Petroleum plans first offshore drilling by 4QFY23

    Mari Petroleum plans first offshore drilling by 4QFY23

    KARACHI: Mari Petroleum Company has planned to drill first well at offshore block in fourth quarter of the current fiscal year.

    The management of the company on Friday while commenting on the Abu Dhabi offshore block, disclosed that the company planned to drill first well in 4QFY23 with the consortium. “For this, company has invested $10 million which will bear drilling expenditures,” according to Insight Research.

    READ MORE: Mari Petroleum stops production from Zarghun, Bolan fields

    Mari Petroleum conducted corporate briefing to discuss financial results and future outlook of the company.

    The Insight Research highlighted key takeaways from the briefing.

    During fiscal year 2021/2022, MARI posted highest net sales and profit after tax of PKR 95 billion and PKR 33 billion with PKR 247.80 Earning Per Share (EPS), up by 30 per cent and 5 per cent Year on Year (YoY), respectively.

    The increase in earnings is attributable to higher realized gas prices led by elevated oil prices and PKR devaluation coupled with higher gas production.

    Company’s production has crossed the mark of 100K BOEPD first time in history due to export of undrawn volumes towards SNGPL network and addition of new wells.

    To highlight, company has exported 45bcf gas towards SNGPL network under 3rd party pipeline access to sell gas.

    The company has planned a CAPEX of $200 million for a period of FY23-FY24, however, materialization of this development hinges on various factors, including security conditions, operational disruptions etc.

    As part of company’s aggressive strategy to acquire new exploration sites, company has won 11 blocks in 2 years (FY21 and FY22), taking cumulative blocks to 29.

    According to management, gas reserves estimate for Bannu west-1 is 55 mmcfd, whereas it will take 7-8 months to come online depending upon on the security situation.

    As per company, average production of Habib Rahi Limestone (HRL) is 630 mmcfd in which company is entitled to receive incremental pricing based on PP-12 on production above 525 mmcfd.

    In recent development, company has successfully completed and tested its first ever horizontal development well in HRL reservoir at a gas rate of around 21mmcfd with a well head pressure of 426 Psi.

  • Mari Petroleum stops production from Zarghun, Bolan fields

    Mari Petroleum stops production from Zarghun, Bolan fields

    KARACHI: Mari Petroleum Company Limited (MPCL) on Thursday announced suspending production of oil and gas from one of its facility located in Balochistan due to torrential rains and flash floods.

    In a communication sent to Pakistan Stock Exchange (PSX), the company announced the suspension of production from Zarghun South Gas Fields and Bolan East Oil Field, Balochistan.

    MPCL is the operator of Zarghun South Gas Field and Ziarat Block in Balochistan with 35 per cent and 60 per cent working interest, respectively.

    Annual 10 MMCFD of gas is produced from Zarghun South Gas Field, which is supplied to SSGCL, while around 500 BPD of oil is produced from Ziarat Block (Bolan East – 1), which is mainly transported to Attock Refinery Limited through bowsers.

    The company said: “The ongoing torrential rains and flash floods in Balochistan have severely impacted the gas pipeline and road infrastructure around Zarghun South Gas Field and Ziarat Block.

    “Resultantly, the company is unable to continue production operation of these sites for the time being.”

    The company is taking all possible measures for early commencement of production after rehabilitation of the pipeline and roads network, according to the communication.

  • Gas price hike to further push up inflation

    Gas price hike to further push up inflation

    KARACHI: The recent approval by Economic Coordination Committee (ECC) to increase the prices of gas will further push up the inflation, analysts said.

    The country is already facing the alarming rise in inflation following sure in prices of petroleum products and electricity tariff.

    The analysts at AKD Securities said that ECC approved hike in gas tariff after a break of almost two years, which was last increased in October 2020.

    READ MORE: Gas price hike report baseless: Musadiq Malik

    “The latest increase will put further pressure on already sky rocketing inflation, as manufacturers are likely to pass on the impact, resulting in higher product prices and slowdown in demand,” the analysts said.

    However, the aforementioned hike will put brake on ballooning gas circular debt, which currently stands at Rs1.23 trillion. As per new flows, the move will generate Rs666 billion in revenue for gas distribution companies.

    Export oriented sector including textile companies will also feel the pinch of this increase as the proposed hike for these sector stands at 77 per cent and 38 per cent, respectively.

    This development will severely impact country’s exports due to rise in manufacturing cost and higher financing rate.

    READ MORE: Govt. halts gas supply to export industry: APTMA

    The proposed weighted average gas prices for domestic consumers stands at Rs885/mmbtu, up by 90 per cent. The government has also made some changes in domestic slabs which has now reduced to 5 as compare to 7 slabs earlier.

    The gas bill of consumers who are using gas up to 400 cubic meter are likely to be affected most, due to increase of 253 per cent in tariff.

    They said that the inflationary impact of the said development will be 66 basis points on Month on Month (MoM) basis, taking average inflation to 21.5 per cent for the current fiscal year.

    READ MORE: FBR exempts sales tax on oxygen gas import

    The gas tariff for fertilizer plants is proposed to increase by 42 per cent and 82 per cent for feed and fuel gas, respectively. As per estimates, this will increase cost of urea manufacturing by Rs420/bag for FFC, while the increase for EFERT is Rs340/bag, due to its reliance on PP12 based gas pricing.

    The manufacturers are likely to pass on any increase in gas tariff as they have already increased urea price by Rs350/bag on 1st July.

    The increase in gas prices is expected to bode well for the E&P sector, including Oil and Gas Development Company Limited (OGDC), Pakistan Petroleum Limited (PPL), and Mari Petroleum Company Limited (MARI), as this would lead to improved cash collection for the companies in lieu of gas supply.

    READ MORE: OGDCL discovers oil, gas reserves in Sindh

    As of March 2022 quarter end, OGDC’s receivables from SNGP stood at Rs142.42 million (Rs33.11/sh), whereas those from SSGC stood at Rs163.58 million (Rs38.03/sh). Similarly, PPL’s receivables stood at Rs141 million (Rs51.82/sh) from SSGC and Rs181.8 million (Rs66.81/sh) from SNGP. Whereas MARI’s receivables stand at Rs5.9 million (Rs44.90/sh) from SSGC and Rs8.3 million (Rs61.90/sh) from SNGP.

    Due to liquidity issues, the companies have historically faced challenges in expanding their exploration activities. During 9MFY22, 61 per cent of PPL’s total sales were derived from SNGP and SSGC, hence PPL stands to be a major beneficiary of the proposal gas price hike.

    The much waited tariff increase is a positive development for gas distribution companies as it will improve their cash flows. Similarly, this will provide a breath of fresh air to E&P sector in the form better liquidity, thus allowing them to expand their exploration activities.

    READ MORE: OGDCL declares over 63% net profit for 1HFY22

  • Mari Petroleum signs exploration agreement

    Mari Petroleum signs exploration agreement

    KARACHI: Mari Petroleum Company Limited (MPCL) on Monday announced that it has executed a farm-in agreement.

    The company signed the with MOL Pakistan Oil and Gas Co. B.V. for acquisition of significant working interest in Margala Block. The company signed the deal to collaborate resources and efforts to jointly perform exploration activities.

    The Block is situated in the Potwar Basin in the vicinity of Islamabad. The assignment of working interest shall be subject to Government approval.

    This farm-in is part ofMPCL’s aggressive strategy not only to increase its exploration acreage, reserves replacement ratio and maximizing shareholder’s value. it will also meet Country’s increasing energy demand from indigenous resources and lowering the burden of imported fuels on national economy.

  • Mari Petroleum board decides consortium to set up NewCo in Abu Dhabi

    Mari Petroleum board decides consortium to set up NewCo in Abu Dhabi

    KARACHI: The board of directors of Mari Petroleum Company (MPCL) on Thursday decided that a consortium of public limited energy giants shall incorporate a company namely NewCo in Abu Dhabi Global Market or Pakistan.

    The company in a notice sent to the Pakistan Stock Exchange (PSX) said that the Board of Directors of MPCL, in its meeting held today i.e. June 24, 2021 has decided that subject to shareholders’ approval, a consortium comprising Mari Petroleum Company Limited (“MPCL”), Pakistan Petroleum Limited, Oil and Gas Development Company Limited, and Government Holding (Private) Limited (collectively referred to as the “Consortium”), shall incorporate a company/special purpose vehicle (a “NewCo”), in Abu Dhabi Global Market or Pakistan, with each Consortium partner having 25% shareholding in the NewCo.

    The Consortium has submitted a bid for one of the blocks offered in the Abu Dhabi Bid Round 2019 and incorporation of the NewCo is one of the conditions precedent to qualify for the award: It is hereby clarified that the award shall be granted by the Supreme Council for Finance and Economic Affairs (SCFEA) of the Emirate of Abu Dhabi, and that no decision in this regard has so far been made. In case the block is not awarded to the Consortium, the NewCo shall be dissolved.

    Further, subject to the approval of respective shareholders and the Consortium being declared a successful bidder by SCFEA, the incorporation of the NewCo and execution of all definitive agreements, an amount of up to USD 100 million will be invested by MPCL over a period of five years (total investment by all Consortium partners: Up to USD 400 million). Any subsequent funding, if required, will be subject to seeking shareholders’ and relevant approvals.

    In addition, subject to approval of their respective shareholders, MPCL (and other members of the Consortium) are required to provide a parent company guarantee for all obligations of the NewCo under the definitive agreements to Abu Dhabi National Oil Company and SCFEA.

  • Mari Petroleum discovers gas in Sindh

    Mari Petroleum discovers gas in Sindh

    KARACHI: Mari Petroleum Company Limited (MPCL) on Monday announced discovery of gas from its exploratory well Hilal-1, drilled in Mari D&P Lease Area, located in Daharki, District Ghotki, Sindh.

    Hilal-1 was spud-in on April 21, 2020 and drilled down to the depth of 1,202m into Sui Main Limestone(SML).

    The well was drilled with the objective to test the hydrocarbon potentials of SML and Sui Upper Limestone (SUL).

    The Drill Stem Tests (DSTs) carried out in SUL Formation flowed gas at a rate of 11 MMSCFD at wellhead flow pressure (WHFP)of 887 Psi at 48/64 inch choke size after acid job.

    While DSTs carried out in SML Formation also successfully flowed 6.88 MMSCFD of gas with 132 barrels per day of water at WHFP of 804 Psi at 40/64 inch choke size subsequent to acid job.

    It is highlighted that this is the 5th consecutive new discovery in Mari D&P Lease Area based on 1,079 sq.km carpet 3D seismic survey of the area in 2015, which was followed by an extensive drilling program.

  • Mari Petroleum sets up subsidiary at Dubai Free Zone

    Mari Petroleum sets up subsidiary at Dubai Free Zone

    KARACHI: Mari Petroleum Company Limited (MPCL) has announced establishment of a wholly owned subsidiary company at Dubai Free Zone for expansion of operations.

    In a notice to Pakistan Stock Exchange (PSX) on Wednesday, the company said that its board of directors had approved establishment of a wholly owned subsidiary company of MPCL in Dubai Free Zone Area and investment of one million US dollars in the proposed subsidiary company as MPCL’s equity contribution.

    The board is of the view that formation of a foreign subsidiary company is imperative for MPCL for expanding its operations across other countries in oil, gas and allied services as well as other sectors.

    Further, activities related to foreign investment and arrangement of foreign financing can be handled more proactively through a company registered abroad.

    The company further said that transfer/investment of funds out of the country would be subject to approval by the State Bank of Pakistan.

  • Mari Petroleum board approves acquisition of two new exploration blocks

    Mari Petroleum board approves acquisition of two new exploration blocks

    The Board of Directors (BoD) of Mari Petroleum Company Limited (MPCL) has given its approval for the acquisition of two new exploration blocks, as announced in a statement issued by the company on Wednesday.

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