Karachi, May 14, 2012 (PPI-OT): Oil and gas updates: PPL may acquire MND and OGDC riding on Nashpa3
Pakistan Petroleum Limited (PPL) has given consent to acquire assets of one MND Exploration and Production Ltd in Pakistan and Yemen through share purchase, as being reported by newspaper viz.
According to Standard Capital, MND is a wholly-owned London-based subsidiary of KKCG SE, one of the largest privately owned groups in the Czech Republic, which has recently announced to divest its entire interest in oil and gas assets in Pakistan and Yemen. As stated, MND is presenting this opportunity as a corporate sale and the bid date for the assets is Friday, May 18 next week.
Some of the MND’s assets in Pakistan include non-operating assets: (i) Sawan Development and Production lease (7.9%percent share) and exploration licences which is situated in Sindh;
(ii) Harnai (40 %) in Baluchistan;
(iii) Ziarat (40 percent) in Baluchistan;
(iv) Barkhan (50 percent) in Baluchistan; and
(v) exploration licence block-3( 20 %) in Yemen.
In Sawan Gas field, PPL already holds 26.2% working interest and at present producing 220 mmcfd gas and is regarded one of the largest gas fields in Pakistan after Sui and Qadirpur structures. PPL considers further development potential in Sawan through unconventional resources of hydrocarbons. As stated drillable prospects are present in Barkhan (operator -PPL) and quite a few prospects also exist in Ziarat and Harnai blocks.
As for Block-3, it is located in the Shabwah basin of troubled country Yemen. Some of the details available about the block include Oil Search of Australia which is the operator; wherein, France based Total is potentially taking over the operatorship of the block. Another European OMV, Czeck based MND and Yemen Oil and Gas Company are other joint venture partners. There is some pending appraisal of a discovery and other than that the block also holds potential prospects.PPL think that the block offers long term opportunities in Yemen which is a producing region. The acquisition of MND offers PPL’s exposure into Sawan Gas Field and Yemeni based exploratory blocks.
Some benefits of acquisition
As stated some of the monetary benefits from this hydrocarbon exposure of PPL from MND include:
(i) remittances of dividend by the purchased subsidiary in UK to Pakistan; and
(ii) recovery of its share in oil.
OGDC is now contemplating its latest find i.e. Nashpa-3 which as per PPIS is scheduled within 15 – 20 days and given previous successes the extent of oil flow could be encouraging i.e. 4000bopd. Standard Capital should keep Standard Capital’s fingers cross.