A consortium of the country's major oil and gas companies has decided to incorporate a special purpose vehicle (SPV) in Abu Dhabi or Pakistan in its bid to qualify for the oil block award.
“A consortium comprising Mari Petroleum Company Limited, Pakistan Petroleum Limited, Oil and Gas Development Company Limited, and Government Holding (Private) Limited, 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,” read Mari Petroleum's filing to the bourse on Thursday.
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.
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“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,” said MPCL.
In its second bid round, Abu Dhabi offered five blocks (two onshore and 3 offshore) through competitive bidding submission deadline of December 31, 2019. The un-risked in-place exploration potential of these blocks is estimated at 6 billion barrels of oil and 44 TFC of gas encompassing a total area of 34,000 sq km.
Abu Dhabi's second bid round provides a major opportunity for the consortium of Pakistan's E&P companies to join the world renowned Abu Dhabi National Oil Company (ADNOC) and unlock untapped resources in one of the world's largest hydrocarbon super-basins by investing in a trusted and reliable business environment.
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If the consortium is declared a successful bidder by SCFEA, all the partners of the consortium will invest $100 million each in the SPV. Total investment by all consortium partners amounts to $400 million.
It added that the members of the consortium are required to provide a parent company guarantee for all obligations of the NewCo under the definitive agreements to ADNOC and SCFEA.