Pakistan has made a significant discovery of oil and gas in the northern region of the country, specifically in the Attock District of Punjab. This find is expected to help reduce the nation’s dependency on energy imports and preserve foreign exchange reserves.
According to a notification, Pakistan Oilfields Limited (POL) announced on Monday the discovery of 714 barrels of crude oil per day and 10.2 million cubic feet per day (mmcfd) of gas from the Jhandial-03 well in the Ikhlas Block, Attock District. This new discovery represents approximately 1% of Pakistan’s total oil production and 0.3% of its gas output from domestic sources. Recent weekly production data indicates that crude oil production was at 68,248 barrels per day and gas production at 3,146 mmcfd as of the week ending June 23, 2024.
The exploration and production company provided four different production estimates for the hydrocarbons from the Jhandial-03 well, noting a crude oil flow range of 701-767 barrels per day and a gas flow range of 7.4-10.2 mmcfd. The well is expected to be connected to the production line within three weeks.
POL, with an 80% working interest in the Ikhlas Block, operates the well, while Attock Oil Company (AOC) holds a 20% interest. Drilling of the Jhandial-03 well began in October 2023, reaching a depth of 17,778 feet in the Lockhart Formation. Topline Research estimated the new hydrocarbon discovery could boost POL’s annual earnings by approximately Rs10 per share or 7% for FY25. POL’s share price rose by 4.30%, closing at Rs540.70 per share on the PSX following the discovery announcement.
In its financial report for the nine months ending March 31, 2024, POL reported a 5% decrease in crude oil production to 1.33 million barrels, translating to 4,855 barrels per day. Gas output also saw a decline of nearly 2%, amounting to 17,576 million cubic feet, or 63.91 million cubic feet per day, during the same period.
POL termed the latest hydrocarbon discovery a “significant quantity” in their PSX notification, though it is moderate in terms of meeting domestic demand.
Energy experts estimate that Pakistan imports about 70% of its total energy needs, with local production covering only 30%. Energy imports accounted for over $15.34 billion out of the total $49.85 billion in imports during the first 11 months of the previous fiscal year, according to PBS. Recently, the government approved a policy for tight oil and gas discoveries, offering a 40% higher tariff for these hydrocarbons compared to conventional ones. This policy aims to boost local production and reduce imports significantly.
