Pakistan's Prime Minister Benazir Bhutto signed agreements for a number of exploration and gas fired power generation projects during a Nov. 30 visit to a London conference promoting investment in Pakistan.
The agreements reflect reforms by Karachi and an aggressive new stance in attracting foreign investment into its energy sector, particularly oil and gas exploration and production and downstream projects tied to the E&P effort.
Earlier this fall, Pakistan disclosed it was prepared to offer opportunities for foreign investment in its energy sector totaling $5 billion.
EXPLORATION AGREEMENTS
Shell Pakistan signed an agreement covering an exploration license approved earlier (OGJ, Nov. 7, p. 94) for salt range Blocks 3272-1 and 2, which cover 5,865 sq km south of Islamabad. Shell will be operator on the block, with the government of Pakistan holding a 10% interest, which can be raised to 15% in the event of development.
Shell's agreement allows an initial 3 year exploration period with subsequent extensions. The work program involves seismic surveys and drilling of one well. A 20 year production lease would follow a commercial discovery.
The company also secured a 47.5% interest in Kirthar concession, where Lasmo Oil Pakistan Ltd. has a 47.5% share and, operatorship and the government holds the remaining 5% interest.
Kirthar concession covers 3,268 sq km of western Sind province and lies about 150 km north of Karachi.
Lasmo said the license allows for a 3 year initial exploration phase, with a 20 year production lease in the event of a commercial discovery. Government's share can be raised to 20% of any commercial project.
British Gas plc was awarded operatorship and a 57% stake in Sulaiman exploration license in partnership with London independents Monument Oil & Gas plc 23.75% and Pict Petroleum plc 14.25% and state owned Oil & Gas Development Corp. 5%.
Sulaiman block covers 1,845 sq km of Baluchistan. British Gas said obligations include 250 km of seismic data acquisition and drilling of one well.
British Gas was also awarded Guddu and Gambat blocks in the Central Indus basin in Sind province, covering 2,093 and 6,594 sq km, respectively.
The company said work commitment on Guddu license entails 200 line km of seismic surveys and drilling of one well. Gambat obligations involve acquisition of 250 line km of seismic data and drilling of one well.
POWER PROJECTS
British Gas also secured a joint development agreement with Saigols Group, a major Pakistani industrial company, to build a 300,000 kw electric power generating plant in the Taunsa area.
The plant will be expandable to 500,000 kw output. British Gas said several sources of gas had been identified for the plant, which will sell power to Pakistan's Water & Power Development Authority (Wapda).
British Gas and Sui Southern Gas Co. also signed a 50-50 joint venture agreement to install gas turboexpanders at several locations within the Pakistani gas grid. These will generate electricity for sale to Wapda.
Bhutto said her government's task force on energy has produced a practical, results oriented policy that has so far seen applications to build power plants in Pakistan amounting to four times the country's needs.
"Now we are planning our second phase," said Bhutto. "We seek to invite private sector investment in power transmission and distribution and supply of fuel to the power generation units. We are offering a package of an estimated $5 billion in projects in power transmission, oil pipelines, oil terminals, and dedicated railway tracks."
Copyright 1994 Oil & Gas Journal. All Rights Reserved.
Issue date: 12/12/94
