KPOGCL fast turning into a hydrocarbon investment hub

High success ratio in relatively unexplored terrain of KP
Oil and Gas industry is renowned for its high risk and high return potential over other industries. All the potential players are focused on reducing the risk factor while increasing the reward potential. Through the evolution of technological advancements and decades of research and developments efforts which had been successful in achieving an average success ratio of 1:10 which means globally out of 10 wells only 1 will be successful.
The true litmus test of potential of hydrocarbons in Pakistan and especially in Khyber Pakhtunkhwa comes into play when we compare the average success ratios. The geology of Pakistan has enabled the Oil and Gas Exploration and Production Companies to achieve average success ratio of 1:3.2, which is an incredible figure in the Oil and Gas industry to achieve.
Amazingly, the success ratio figure tilts even more towards to the successful discovery in the Province of Khyber Pakhtunkhwa where the Oil and Gas Exploration and Production Companies have been able to achieve average well successful ratio of 1:2.8, which means that out of 2.8 wells drilled in the Province of Khyber Pakhtunkhwa 1 (one) would be a successful discovery.
The people of Pakistan woke up to the dream of "Naya Pakistan" given by Prime-Minister elect Mr. Imran Khan on 26-Jul-18.
By the Grace of Almighty Allah, the geology of Khyber Pakhtunkhwa has been blessed with tremendous hydrocarbonsreserves which has been proved by the discoveries made in last 4 years in Tal, Nashpa and Baratai Blocks and yet more to discoveries are to be made in a year to come by KPOGCL. KP oil production reached to 56% of indigenous crude oil production of Pakistan in a short span of 4 years. KPOGCL being a nascent company in Oil & Gas Exploration and Production industry with meager financial resources and major opposition from civil administration and bureaucracy was yet able to successfully identify seven major petroleum blocks having high probability of success. The petroleum system identified by KPOGCL gives a guest insight to the approaching bidding round from Ministry of Petroleum.
According to experts, the total potential of hydrocarbon reserves in the province of Khyber Pakhtunkhwa has been estimated to be 1.1 Billion Barrels of Crude Oil, 1.1 Billion Barrels of Shale Oil and 46 Trillion Cubic Feet (TCF) of Natural Gas. All these reserves could easily be translated in to Rs 47 Trillion out of which the province of Khyber Pakhtunkhwa would generate revenues to the tune of Rs 100 Billion by the year 2020.
In order to fast-track the Oil and Gas Exploration and Production Activities in KP, Provincial Holding KPOGCL, fully owned by Government of KPwas established pursuant to the Petroleum Policy 2012. KPOGCL is working tireless to increase indigenous production, providing a thriving and an enabling environment and to act as a "One Window Facilitator to Oil and Gas Exploration and Production Companies.
KPOGCL relentless effort for the Oil and Gas Exploration and Production sector of Khyber Pakhtunkhwa has ultimately increasing E&P activity in province which is apparent from the fact that in 2013, only two (02) seismic crews were active while in 2017 six (06) seismic crews are operating in Khyber Pakhtunkhwa. Another indicator of KPOGCL being the source of the paradigm shift in oil and gas sector is apparent from the fact that in 2013 only three (03) drilling rigs were operational while in 2017 a total of eleven (11) drilling rigs are operational.
KPOGCL efforts contributed in restoration and transformation of security paradigms to promote KP as a land of Exploration & Production activity and tranquility. Such results are apparent from the fact that in 2013, in very short period, KPOGCL has out shine other oil & gas exploration & production companies. In 2013 only three (03) blocks were operational out of a total of twenty one (21) blocks while in 2017, twenty seven (27) blocks are active out of twenty eight (28) blocks.
KPOGCL 100% OWNED LAKKI EXPLORATION BLOCK
The professionals in Oil & Gas sector believe that KPOGCL may have discovered the largest Geological structure in DIK,Bannu, Tank,Karak and LakkiMarwat which is being called Lakki Block by the industry since 3 years. It is being shown in petroleum maps of Director General of Petroleum Concession (DGPC) .The professionals at KPOGCL are at upbeat, yet have kept things highly confidential furthermore opening of DIK to Multan Geological corridor will bring a great opportunity in Oil & Gas production to Pakistan; with Tal block in North and Dhodak in South.
The market forcesbelieves that the ultra-super Geological structure identified by KPOGCL is a great success story of KPOGCL.
KPOGCL and Government of KP are indebted to present Federal Government for awarding license to the Lakki Petroleum Concession Block to KPOGCL in such a short period of time. KPOGCL and Government of Pakistan signed the Petroleum Concession Agreement PCA and Exploration License for the Lakki Block on 12-Sep-2018; which will set the impetus for the new Government led by Prime Minister Imran Khan into new dimensions of Energy Security and Self Reliance.Speedy decision by PTI mindset seems to have been activated. The ultra-super structure of Lakki Block will be a massive success for a nascent company like KPOGCL and its professionals.
Potential investors from UAE and Qatar intends to invest in KP and are negotiating with KPOGCL as JV partners and they stated that their trust level on KPOGCL is at a very high pedestal due to their quality of Geological Studies, Processing of data and High quality interpretation by using inhouse world class software and hardware. It is learnt that KPOGCL has opted for very high performance softwares from Halliburton, Schlumberger and LMKR, instead of very cheap pirated softwares. It's due to this approach of management of KPOGCL that it has achieved success in delineating some deep and ultra-deep geological structures in Lakki. Sources at OGDCL and POL appreciates the aggressive policy of KPOGCL professionals and management. Sources at OGDCL specially appreciated KPOGCL input in Baratai Block, where the successful discovery can be attributed to the processing and interpretation twist.
Lakki Block is quite a hostile area from the climatic and terrain point of view; and despite of that the professionals at KPOGCL managed to criss cross the mountain ranges of Marwat and Khisor.
KPOGCL professionals have been to these areas for Oil and Gas prospect, where nobody has ever been approached .The passion and determination of young professionals is bearing fruit and striving to achieve self-sufficiency in Oil & Gas Upstream Sector.
The professional at KPOGCL are upbeat and highly optimistic of the Lakki Block. Already a number of investors are negotiating with KPOGCL for joint venture into Lakki Block. KP has become the newest and most attractive geological frontiers in Pakistan. The petroleum prospects are high and so is the success ratio of KP. Today KP is producing more than 55% of the total oil produced in Pakistan, over 15% of total Gas and 25% of high value LPG. Lakki Block lies south to Tal and Nashpa high producing Blocks in Bannu Basin, having an area of 2030 Sq. km and in prospectivity Zone-I (this Zone Offers best prices of Oil and Gas for operators).
All required basic elements of Petroleum System (Source Rocks, Reservoir rocks, trap and seal: required for prolific and producing areas) are present and well established in Lakki Block. Furthermore, the Block has many active Oil and Gas Seepages in and around the Block eg Kundal Oil Seep, Bain Pass Gas Seepage, Mitha Khattak Oil Seepage. All these seepages are considered to be very important from petroleum exploration and production point of view. As these seepages indicate the presence of existence source rock (a rock having potential to generate Hydrocarbon), maturity of source rocks (having gone through enough temperature to generate hydrocarbon) and migration of the hydrocarbon being generated (another important step towards finding hydrocarbon). The Lakki Block contains reservoir rocks (producing in the nearby fields) having excellent reservoir sands having porosities (ability to store hydrocarbon in the rock) of about ~23%.
Due to visionary leadership, technically sound teams and aggressive planning, KPOGCL plans to drill an exploratory well in the Lakki Block in 2019-20 after mitigating the risks associated with exploration through detailed G&G work. In case of discovery, this will open new venue for Exploration and Production.
Discovery in this Block will not only open new areas for exploration but will also help KPOGCL to generate revenues in addition to already successful discovery in Dhok Hussain-01 well, lying north of this Block. This will help KPOGCL to get more confidence and accelerate the exploratory activities in other parts of the KP. At presently, KPOGCL CEO along with his team are quite optimistic about the Block and hope that KPOGCL will contribute more towards energy security and help our country to get self-reliance in Oil and Gas and save billions of dollars being spent on imports annually.
GREATEST GOOD FOR GREATER NUMBER OF PEOPLE: PUBLIC OFFERING & PRIVATE PLACEMENT-VERY SOON
For materialization of Vision 2025, KPOGCL has developed a sustainable strategy from every angle, including high caliber human resource, second to none software, diversified funds.
In Khyber Pakhtunkhwa, the probability of success is one of the highest in the region, which is a comparative advantage of the Province & KPOGCL. In order to exploit the comparative advantage through partners and multi-facet investments, of which tapping the financial capital markets and the Public Offerings are considered to be the most efficient and main pillars of the "Mission".
KPOGCL has strong growth prospects, both in near term and long-term. The strong future growth prospects can earn huge 'Premium' through IPO of the Company. Dhok Hussain discovery will contribute very positively to the near-term growth in Sales and Profitability of the Company while its continuous engagement in Exploration activities will increase its reserves portfolio. Successful exploration activities are critical to the sustained long-term growth in future earnings.
KPOGCL is highly likely to be awarded the status of 'Green Field' project which will further add to the amount of 'Premium' to be raised through public.Prior to Public Offering, KPOGCL intends to make Placement of its equity shares with Large Funds and High Net Worth Individuals (HNWIs) and in order to ensure transparency, a fair price determination through 'Private Book Building' is under process.
ESTABLISHMENT OF ENERGY ASSET MANAGEMENT COMPANY
In order to achieve its Vision & Mission, besides Public Offering & Private Placement, KPOGCL is striving to establish an Energy Asset Management Company in the Province. The Energy Asset Management Company will be established as a Non-Banking Financing Company (NBFC) under section 509 (1) of the Companies Act, 2017 and NBFC Rules, 2003.
The prospective investors include diaspora, multi-national banks and international equity investing financial institutions besides National individuals and equity financing institutions.
RIGHT TIME TO INVEST IN KPOGCL
KP has the potential of 2.2 Billion Barrels of Oil resources and Natural Gas resources topping 46 Trillion Cubic Feet (TCF). Exploration as Operator in 7 Blocks identified by KPOGCL namely Lakki, Nowshera, DIK East, DIK-West, Miran, Khushal and Charssadda will be carried on fast track basis.
NOCs for these blocks have been received from Ministry of Defense while applications have been submitted to DGCP for calling of Bidding round.The Company has already marketed these Exploration Blocks to national and international investors. Revenues from these blocks are expected to be high, being prospective blocks.
The merger of ex-FATA into KP has increased opportunities for KPOGCL multi-fold. Ex-FATA offers some 20 TCF of Natural Gas which will become an earning source for KPOGCL. The Government of Khyber Pakhtunkhwa is also supporting the company by allocating Billions of Rupees in its budget.
KPOGCL is inviting national and international oil companies to join in its operations in blocks including Lakki block. KPOGCL can share with prospective investors the preliminary information on geology, expected success and economics of its blocks including Lakki.
It is only a matter of time now that the financial outlook of the company would translate the four years of hard work. National & international investors, HNWIs, private equity managers are strongly encouraged to consult KPOGCL for prospective, fruitful and timely investment.
As per Petroleum Policy 2012 KPOGCL has the right to acquire 2.5% joint venture shares in each and every petroleum concession agreement (PCA) blocks of KP, Development and Production (D&P) leases which gives a great share to the owners of KPOGCL.
Hence we can see that KPOGCL is not only a hope for KPK but also for the energy security of Pakistan. The professionals of KPOGCL are mostly young and determined to achieve the goals that are put up by the CEO of KPOGCL.