KARACHI: PPL Asia, a subsidiary of Pakistan Petroleum Limited (PPL) has reached a settlement with Iraq’s state-owned Midland Oil Company (MdOC) regarding the Exploration, Development, and Production Service Contract for Block-08 in Iraq.

The agreement was signed on Monday in Baghdad by Managing Director PPL Asia Imran Abbasy, and Director General MdOC Muhammd Yaseen Hassan.

“The settlement between Pakistan Petroleum Limited (PPL) Asia E&P B.V., a subsidiary of PPL, and Midland Oil Company (MdOC) marks the conclusion of their Exploration, Development and Production Service Contract (EDPSC) for Block-8, Iraq, which expired in May 2022”, PPL said.

Efforts to resolve the lingering settlement from 2022 involved addressing longstanding disputes and claims between the parties, it added.

PPL Asia’s commitment to finding a resolution demonstrates sustained negotiations and legal efforts, culminating in an agreement signed on October 06, 2024, by PPL’s MD/ CEO Imran Abbasy and MdOC’s DG Muhammad Yaseen Hassan.

“A significant milestone in these efforts was the net settlement of $6.0 million, with MdOC paying through a third party,” PPL said. This final resolution closed all matters related to the contract without either side admitting fault or liability, reflecting the persistent and strategic endeavors to achieve a mutually favorable outcome after over two years of engagement, it added. “This not only brings closure to PPL’s operations in Block-8 but also delivers a valuable foreign exchange recovery for the company and Pakistan.”

PPL Asia had been awarded the license for the EDPSC for Block-8 in Iraq back in 2012 and drilling was initiated in April 2019 at Block-8’s Madain-1 well, which led to the discovery of a sub-commercial volume of oil in FY20. Consequently, the well was plugged and abandoned.

Copyright Business Recorder, 2024