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The Oil and Gas Development Company Limited (OGDCL) has released the sales revenue of Rs 61.799 billion in the first quarter (July 2018-September 2018). Sales revenue and profit before tax climbed to Rs 61.799 billion and Rs 39.363 billion respectively showing growth of 41 percent and 61 percent. Average basket price of crude oil during the three months stood at $ 73.91/barrel against $ 49.60/barrel in the comparative period leading to higher average realised price of $ 64.30/barrel against $ 45.13/barrel in the last period.
In addition, the OGDCL's financial results were supported by the improvement in realised price for gas and LPG averaging Rs 285.44/mcf and Rs 71,516/ton compared with Rs 252.16/mcf and Rs 45,337/ton respectively in the preceding period.
Moreover, increase in gas and LPG production complemented by positive exchange rate variance, higher share of profit in associate and interest income on investment and bank deposits lent further strength to business financials.
However, the OGDCL's financial performance during the reporting period is slightly influenced by the increase in operating expenditures mainly on account of joint operations expenses and work-over charges coupled with higher cost of dry and abandoned wells and taxation in the current period.
Nonetheless, the company recorded profit after tax of Rs 26.735 billion translating into earnings per share of Rs 6.22. The Board of Directors has announced first interim cash dividend of Rs 2.75per share (27.50 percent) for the year ending June 30, 2019.
The OGDCL being the market leader in the E&P sector holds the largest exploration acreage in the country which as of September 30, 2018 stood at 88,933 sq km representing 26 percent of the country's total area under exploration. Business exploration assets are spread across all the four provinces and currently comprise forty seven (47) owned and operated joint venture exploration licences. Additionally, the company possesses working interest in four blocks operated by other E&P companies. With an aim to unlock value in the operated assets, the OGDDCL during the period under review acquired 256 line km of 2D and 251 sq km of 3D seismic data.
Aforementioned 2D and 3D seismic data acquisition represents 40 percent and 60 percent of total seismic data acquired in the country respectively. Moreover, 1,144 line km of 2D seismic data has also been processed/reprocessed using in-house resources.
In addition to the above, the OGDCL during the reporting period carried on with its drilling activities whereby drilling and testing of five wells out of eleven (11) ongoing wells from previous fiscal years have been completed. Total drilling recorded in three months was 13,688 meters. The OGDCL's exploratory endeavors during the three months resulted in two oil and gas discoveries namely Chanda-1 and Mela-5 in district Kohat, KPK. The expected cumulative daily production potential is 795 barrels of oil and 2.45 mmcfd of gas while preliminary reserves estimate is 89.80 billion cubic feet of gas and 9.33 million barrels of oil combined 25.62 million barrels of oil equivalent.
The development projects of OGDCL during the reporting period continued the development work on Nashpa compression project under which the installation of front end raw gas compression facilities will be carried out to exploit maximum production potential from Nashpa field. The Nashpa compression project is expected to be completed in March 2020.
Likewise, up-gradation of plant facilities at Mela field coupled with laying of gas pipeline to Nashpa plant for the LPG and NGL extraction are under way and anticipated to be completed in June 2019.

Copyright Business Recorder, 2018

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