Sale of Strategic Interest in Oil & Gas Development Company Ltd ...
Sale of Strategic Interest in Oil & Gas Development Company Ltd. Summary of Key Information June 2003
Summary of Key Information
1
Merrill Lynch and KA SB Securities (Pvt.) Ltd. (“KASB”) have prepared this Summary of Key Information on behalf of the Government of Pakistan (“GoP”), which is seeking expressions of interest from parties interested in acquiring a strategic interest in the Oil & Gas Development Company (“OGDCL”). This document has been prepared for the sole purpose of assisting recipients in assessing whether to submit an Expression of Interest to the Privatisation Commission (“PC”). This is not an offer document and is supplied for information purposes only and neither it nor its contents have been approved by or represent the views or plans of Merrill Lynch, KASB, GoP or OGDCL. This document is not intended to be an offer, invitation, solicitation or recommendation to any persons in relation to securities or financial instruments. This document does not purport to be comprehensive and is provided as background information only. In preparing this document, Merrill Lynch and KASB have obtained information from publicly available sources, GoP, PC and OGDCL. Merrill Lynch, KASB, GoP, PC or OGDCL nor any of its or their subsidiaries or controlling persons, nor any of their respective directors, officers, partners, employees, agents, representatives or advisers makes any representation or warranty, express or implied, or assume any responsibility whatsoever as to the accuracy, authenticity or completeness of the information, projections, assessments or opinions contained in this document or otherwise made available whether verbally, in writing, by electronic mail or otherwise by any other means whatsoever nor as to the reasonableness of any assumption contained herein or the basis for its preparation. Any demand, claim, dispute and/or liability arising therefrom or in connection thereto (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed. Nothing contained herein is, or shall be relied upon as, a promise or representation or warranty, whether as to the past or the future for any purpose whatsoever. Any estimates, projections, targets, assumptions or forecasts contained herein involve significant elements of subjective judgment and analysis which may or may not be correct. The information contained in the document is not an appraisal or valuation of all or part of OGDCL and does not take into account the impact of changes to the business of OGDCL, any potential transactions or a change in control. Merrill Lynch and KASB are not obliged to update or furnish any additional information on OGDCL to any recipient. No information set out in this document will form the basis of any contract. Any prospective investor may be required to acknowledge that it does not rely on, nor has it been induced to enter into such agreement by any representation or warr anty, save and except those expressly set out in such agreement. This document is not intended to form the basis of any investment decision or any decision to acquire any securities or other instruments. The document does not constitute an offer or invitation to purchase any securities or other instruments and its delivery to you shall not be taken as any form of commitment on the part of any person to proceed with any transaction. Merrill Lynch, KASB and their respective affiliates, officers, employees and representatives expressly disclaim any and all liability relating to or resulting from the use of this documentation such other information by a prospective investor or any of its affiliates, employees or representatives.
Summary of Key Information
List of Abbreviations 1P Reserves
Proven Reserves
2P Reserves
Proven plus Probable Reserves
3P Reserves
Proven, Probable & Possible Reserves
Bcf
Billion cubic feet
BHP Billiton
BHP Petroleum (Pakistan) Pty Ltd.
BP
BP Pakistan Exploration & Production Inc.
CAGR
Compounded Annual Growth Rate
E&P
Exploration and Production
EBIT
Earnings before Interest & Taxes
EBITDA
Earnings before Interest, Taxes, Depreciation & Amortisation
ENI
LASMO Oil Pakistan Limited
EoI
Expression of Interest
GoP
Government of Pakistan
LPG
Liquefied Petroleum Gas
MGCL
Mari Gas Company Limited
mmbbl
Million barrels
mmboe
Million barrels oil equivalent
mmcf
Million cubic feet
mmcf/d
Million cubic feet per day
OGDCL
Oil & Gas Development Company Limited
OMV
OMV (Pakistan) Exploration G.m.b.H
PAT
Profit after Tax
PC
Privatisation Commission
PGCL
Pirkoh Gas Company (Private) Limited
PKR
Pakistani Rupees
POL
Pakistan Oilfields Limited
PPL
Pakistan Petroleum Limited
RSOQ
Request for Statement of Qualification
SOQ
Statement of Qualification
Tcf
Trillion cubic feet
Tullow
Tullow Pakistan (Development) Limited
USD
US Dollars
2
Summary of Key Information
3
Table of Contents 1. Introduction
4
2. E&P Industry in Pakistan
5
2.1
Overview of Pakistan Energy Sector
5
2.2
Energy Supply & Demand
6
2.3
Industry Participants
7
3. Company Overview 3.1. OGDCL Asset Portfolio
9 9
3.2
Portfolio Upside
11
3.3
Exploration
11
3.4. Operational Performance
12
3.5
Financial Highlights
13
3.6
Operating Costs and High Netbacks
15
4. Key Contacts
16
Annexure A: OGDCL – Operated & JV Interests
17
Summary of Key Information
4
1. Introduction The Government of Pakistan (“GoP”) intends to privatise Oil & Gas Development Company Limited (“OGDCL” or “Company”). In this regard, the Privatisation Commission (“PC”) of the GoP has invited Expressions of Interest (“EoI”) from strategic investors to acquire 51% of the GoP shareholding in OGDCL. Acquisition of this shareholding will involve the transfer of management control to the investor. The privatisation of OGDCL offers a unique investment opportunity for large oil and gas companies to assume a leading role in the domestic E&P sector in Pakistan. Established in 1961 by the GoP to undertake exploration and development of oil and gas resources in the country, OGDCL has the largest exploration and production (“E&P”) portfolio in Pakistan. OGDCL carries on activities in various concessions in the Northern, Central, and Southern regions of Pakistan with: §
Remaining proven plus probable (“2P”) reserves of 1.35 billion boe (9.1 Tcf raw gas and 172 mmbbl oil as of Jan 1, 2003), of which 86% are operated.
§
Material positions in 4 major developed gas fields
§
Production of over 130,000 boe per day (780 mmcf/d sales gas and 25,000 bbl/d oil)1
§
Significant scope for appraisal and development (2.1 billion boe remaining proven, probable and possible (“3P”) remaining oil and raw gas reserves) as of Jan 1, 2003
§
Largest onshore acreage position in Pakistan with considerable exploration upside
§
Most extensive E&P database in Pakistan, developed over four decades of successful E&P activity
§
FY2002 revenue of US$647 million, net operating cash flow of US$314 million and profit after tax of US$273 million
Pakistan currently imports oil to meet a material part of domestic oil consumption requirements, and gas demand is forecast to exceed indigenous production by 2008. The increase in demand for gas presents an excellent opportunity for increasing exploration activities to cater to a ready gas market and realising the upside potential in OGDCL’s asset portfolio. Pakistan is prospective, particularly for gas. A number of international companies have made significant discoveries in the country in recent years and have already developed or committed to develop these fields. The offer for sale of a strategic interest in OGDCL is an integral part of the GoP’s reform and restructuring initiatives for the domestic oil and gas sector, shifting its role from an owner-operator to a regulator. The GoP’s objective is to also introduce modern and efficient management and technological systems to OGDCL by way of private sector participation.
1 365 Day basis for the period July 1, 2001 to June 30, 2002
5
Summary of Key Information
2. E&P Industry in Pakistan 2.1
Overview of Pakistan Energy Sector
The energy sector is vital to Pakistan’s continued economic growth. Total primary energy supplies in FY2002 were 337 mmboe, of which oil and gas constituted 84% (41% oil and 43% gas). Indigenous production, in 2002, represented 100% of gas consumption but less than 15% of domestic oil demand. Figures 1 & 2: Primary Energy Supplies (FY2002) mmboe 350
Local Oil Production 26%
300 250 200 150 100
Imported Crude Oil 74%
50 0 1998
1999 Oil
2000 Gas
2001 Others
2002
Source: Pakistan Energy Yearbook 2002
Over the period 1998-2002, on average 75% of natural gas was consumed by the power, fertilizer and domestic sectors. Over the same period, the main consumers of oil were the power and transport sectors, accounting for an average 80% of total consumption. Figures 3 & 4: Historical Natural Gas & Oil Consumption Natural Gas Consumption
Bcf 800
mmboe
Oil Consumption
140
700
120
600
100
500 80
400 300
60
200
40
100
20
0 1998
1999
2000
Power Domestic Commercial Transport (CNG) Source: Pakistan Energy Yearbook 2002
2001
2002
Fertilizer General Industries Cement
0 1998
1999 Power Others
2000 Transport Domestic
2001 Industrial
2002
Summary of Key Information
6
2. E&P Industry in Pakistan (cont’d) 2.1
Overview of Pakistan Energy Sector (cont’d)
Pakistan offers a competitive fiscal regime for the E&P sector, with the government take of 58-65% comparing favourably with countries such as India (68-70%) and Indonesia (85-88%)2 . In addition, the wellhead prices of oil and gas are indexed to international crude/HSFO prices with specified discount rates applicable to gas.
2.2
Energy Supply & Demand
Pakistan is largely a gas -producing country with indigenous gas constituting 43% of primary energy supplies in FY2002. Oil represents 41% of primary energy supply and is a major energy import for Pakistan, with 86% of the country’s oil demand met through crude oil and refined product imports in 2002. The GoP is focusing on the substitution of imported oil with indigenous resources both through enhancing local oil production, and increasing the share of gas in the energy supply. For the period 1998-2002, oil and gas consumption grew at a CAGR of 0.6% and 6.5 % respectively. A study conducted by independent consultants, M/s Beicip Franlab3 , estimates the average domestic gas demand growth rate to range from 4.3% to 7.1% p.a. over the next 20 years. The study also considers various gas supply scenarios taking into account the production from existing fields, recent discoveries and potential future discoveries. The study concludes that the Pakistan economy is likely to experience a gas shortfall between 2005 and 2008, based on the production from existing fields and commissioning of recent discoveries.
2 Source: IHS Energy Group 3 Natural Gas Import Study in Pakistan by M/s Beicip Franlab, September 1999 conducted under the auspices of the Asian Development Bank for the Government of Pakistan
Summary of Key Information
7
2. E&P Industry in Pakistan (cont’d) 2.3
Industry Participants
Pakistan has a vibrant and competitive oil and gas sector with the active participation of several multinational E&P and integrated companies. §
There are currently 24 operating companies in the sector and a further 16 in joint ventures. §
Among the four locally incorporated companies, two are state-owned and managed, viz OGDCL and Pakistan Petroleum Ltd. (“PPL”); two are locally incorporated and public listed, viz. Mari Gas Co. Ltd. (“MGCL”) and Pakistan Oilfields Ltd. (“POL”); and the remaining operators are international companies, including: § § § § § § § § § § § §
BHP Billiton BP ENI Kufpec Novus Petroleum Occidental OMV Petronas Premier Shell TotalFinaElf Tullow
The rapid commercialisation of recent discoveries including Zamzama (BHP), Sawan (OMV) and Bhit (ENI) has reinforced the confidence of the international E&P companies and private sector investors in the GoP’s commitment to maximize the use of indigenous gas resources on a fast-track basis. Increasing investment and participation in the sector has also been prompted by: §
Introduction of the Petroleum Policies 1994, 1997 and 2001 which provide attractive fiscal incentives for onshore and offshore exploration;
§
Attractive contractors’ take ranging between 35-42% (after deduction of taxation and royalties);
§
Competitive process for obtaining an exploration license and acreage for all E&P operators ensuring fair play;
§
Introduction of the Model Petroleum Concession Agreement; and
§
Introduction of Model Production Sharing Agreement for offshore areas.
8
Summary of Key Information
2. E&P Industry in Pakistan (cont’d) 2.3
Industry Participants (cont’d)
The holding of reserves and shares in production of existing participants is shown below. Figures 5 & 6: Pakistan Oil & Gas Reserves Status (by Operator) Oil
Gas
Total Remaining Recoverable: 300 mmbbl
Total Remaining Recoverable: 26.98 Tcf
OGDCL 49.7%
OGDCL 37.8%
Others 10.9%
BP 24.3%
ENI 5.6% POL 12.0% PPL Others BHP 8.2% 3.4% 2.4%
BHP 4.3% OMV 5.9% MGCL 20.3%
PPL 15.3%
Source: Pakistan Energy Yearbook 2002; Gross Operated Reserves status as of July 2002. No adjustment for JV shares.
Figures 7 & 8: Pakistan Oil & Gas Production (FY2001) (by Operator) Oil
Gas
Total: 23.2 mmbbl (63,548 bbl/d)
Total: 923.76 bcf (2,531 mmcf/d)
BP 47.2%
OGDCL 32.1%
PPL 35.8%
OGDCL 29.0%
ENI 2.6%
Others PPL 2.9% 3.8%
POL 14.0%
Others 4.4% BHP 3.6%
Source: Pakistan Energy Yearbook 2002, for t he period July 2001 – June 2002
BP 8.5%
MGCL 16.2%
9
Summary of Key Information
3. Company Overview The privatisation of OGDCL offers the opportunity for a strategic investor to acquire a majority stake in Pakistan’s leading oil and gas company. The Company’s asset portfolio includes developed fields with material production as well as un-drilled exploration leads and prospects.
3.1.
OGDCL Asset Portfolio
OGDCL is comparable in size to large international oil companies, and its portfolio is also diversified with respect to risk. The Company’s prime developed assets (Qadirpur, Uch, Dhodak and Pirkoh) offer attractive cash flows to sustain further exploration and development activities. Figure 9: Comparable Company 1P Reserves (31-Dec-01) 1P Reserves (mmboe) 2,500.0 2,000.0 1,500.0 1,000.0 500.0
Oil Source: Blackwatch Petroleum Services Limited, Herold
Gas
Woodside
PTT E&P
OGDC OGDCL
Talisman
Apache
KerrMcGee
Devon
Unocal
CNOOC
Burlington
Anadarko
0.0
10
Summary of Key Information
3. Company Overview (cont’d) 3.1.
OGDCL Asset Portfolio (cont’d)
OGDCL operates 34 producing and 14 exploration concessions, with significant non-operated interests in another 24 producing and 6 exploration concessions. Table 1: Summary of Major OGDCL Oil & Gas Fields January 1, 2003 2P Recoverable Reserves Oil (mmbbl) Major Fields Qadirpur Uch Pirkoh & Loti Dhodak Subtotal Northern Fields Southern Fields Central Fields Non-Operated Fields TOTAL
Gas (Bcf)
2.7 29.9
2,866.5 2,979.6 804.9 555.5
32.5 56.7 53.8 28.7
7,206.4 356.1 257.5 349.5 952.2
171.8
9,121.8
All figures represent OGDCL net share, including Qadirpur (75%) Source: Blackwatch Petroleum Services Limited, OGDCL
Operated fields represent 86% of OGDCL’s reserves, as of January 1, 2003. Figure 10: OGDCL’s Petroleum Reserves in Operated and Non-operated Concessions NonOperated 14%
Operated 86% Source: Blackwatch Petroleum Services Limited, OGDCL
In addition, OGDCL has an in-house technical services division, which provides services to its E&P division as well as to external clients. The range of services provided includes seismic data acquisition and processing, drilling and related services, wireline logging, and construction and genera l support services.
11
Summary of Key Information
3. Company Overview (cont’d) 3.2
Portfolio Upside
OGDCL’s estimated remaining proven, probable and possible “3P” reserves of 2.1 billion boe (13.1 Tcf raw gas and 289 mmbbl oil)4 offer a significant scope for appraisal and development. Furthermore, OGDCL’s asset portfolio has additional commercial potential due to the high reserves to production ratio and the relatively modest application of proven and/or advanced technology. Figure 11: OGDCL Reserves – Upside Estimates
Possible Reserves
34%
66%
Proven & Probable Reserves
3P reserves = 2.1 billion boe Source: Blackwatch Petroleum Services Limited
3.3
Exploration
OGDCL has devoted significant investment to exploration activities over the past four decades and has made a number of major discoveries. OGDCL has the largest acreage position in Pakistan and currently operates 14 exploration concessions (over 20,000 acres) and holds non-operated working interests in another 6 exploration concessions (over 25,000 acres).
4 Based on a conversion facts of 1 boe = 5.80 million BTU; gas reserves for individual fields converted according to individual heating values.
12
Summary of Key Information
3. Company Overview (cont’d) 3.4.
Operational Performance
OGDCL’s production has consistently increased over the last few years. During FY2002, the company produced, on average, 25,000 bbl/d crude oil and 780 mmcf/d gas5 . Total production in 2002 achieved a historical high, reflecting the completion of facilities work in some fields. The current production rate of many of OGDCL’s fields could be enhanced substantially. In particular, through the application of modern technologies and field management techniques, Qadirpur, Uch and Dhodak have the potential to produce at significantly higher levels than current production. Figures 12 & 13: Major Oil & Gas Fields by Net Production (FY2002) Gas Producing Fields
Oil Producing Fields
Non-OP 21%
Non-OP 14% Pasahki 24% Others 1% Sadkal 2%
Qadirpur 37%
Nandpur 7% Others 7% Dakhni 2% Missakeswal 2% Lashari C 3% Thora 4% Rajian 4% Sadkal 4%
Dakhni 2% Dhodak 5%
Dhodak 10% Sono 6%
Pirkoh & Loti 16%
Kal 6%
Uch 16%
Tando Alam 5%
Source: Blackwatch Petroleum Services Limited and OGDCL
OGDCL has demonstrated a strong track record of development and growth since its inception in 1961. With the implementation of a number of key development/expansion projects including Qadirpur, Uch, Loti, Panjpir, Sadkal, Bobi and Kunnar, the gas sales volume has increased at a CAGR of 10% for the period 1997-2002. Figure 14: Annual Sales Volume Growth(1) mmbbl 9.0
bcf 300.0
8.8
250.0
8.6 8.4
200.0
8.2
150.0
8.0 100.0 7.8 7.6 1998
1999
2000
Crude oil sales volume (LHS)
2001
50.0 2002
Gas sales volume (RHS)
Source: Company Annual Report (1998-2002) ( 1 ) Annual gas sales for OGDCL and Pirkoh. Annual crude sales exclude condensate production from Dhodak.
5 365 Day basis for the period July 1, 2001 to June 30, 2002
13
Summary of Key Information
3. Company Overview (cont’d) 3.4.
Operational Performance (cont’d)
The benchmark price used for gas, in all OGDCL pricing agreements, is the Saudi Arabian HSFO price, and for oil a basket of Middle Eastern crude. Table 2, following, details average oil and gas prices realised by OGDCL over the last 5 years. Table 2: Historical Oil & Gas Prices
Avg. realized crude oil price (USD/bbl)
1998
1999
2000
2001
2002
13.30
11.79
21.11
23.63
20.70
1.48
1.28
1.56
1.87
1 .73
Avg. realized gas price (USD/mcf) Source: OGDCL Annual Report
The following table details OGDCL’s primary customers. Table 3: OGDCL Primary Customers Gas Pipeline Quality
Low Heating Value
Oil / Condensate
§ Sui Northern Gas Pipeline
§ Uch Power
§ Attock Refinery
§ Sui Southern Gas
§ Fauji Kabirwala Power
§ Pakistan Refinery
LPG § LPG marketing companies
Source: OGDCL
3.5
Financial Highlights
OGDCL is one of the largest and most profitable companies in Pakistan and has maintained a strong growth record with a CAGR of Profit After Tax (in PKR) at over 27% for the period 1998-2002. Net sales in the year ending June 30, 2002 totalled PKR 39.8 billion (US$ 647 million), representing a 5% increase over the previous corresponding period in local currency terms. Increased sales were driven by a combination of increased production and higher average realised prices. Figure 15: OGDCL Financial Performance (USD) USD million 700
USD Revenues CAGR: 14.6% USD PAT CAGR: 27.3%
600 500 400 300 200 100 1998
1999
2000 2001 Revenues Profit after Tax
Source: OGDCL Annual Report (1998-2002)
2002
14
Summary of Key Information
3. Company Overview (cont’d) 3.5
Financial Highlights (cont’d)
Pirkoh Gas Company Limited (“PGCL”) is a private limited company incorporated i n 1982, governed under the Companies Ordinance, 1984. PGCL is a wholly owned subsidiary of OGDCL and operates the Pirkoh gas field. However PGCL is not consolidated, for accounting purposes, with OGDCL. During the year ending June 30, 2001, PGCL net sales stood at PKR 2,196 million (USD 36 million), showing year-on-year decrease of 21% in local currency terms, primarily due to lower gas production. Figure 16: PGCL Financial Performance (USD) USD million USD Revenue CAGR: -2.7% USD PAT CAGR: -8.1%
50 40 30 20 10 0 1998
1999 Revenues
2000 2001 Profit after Tax
2002
Source: OGDCL Annual Repor t
Key financials for OGDCL and PGCL are highlighted in the following tables. Table 4: OGDCL Summary Financials PKR million
US$ m(1)
1998
1999
2000
2001
2002
200 2
Total Revenue
16,224
14,232
25,299
38,297
39,805
646
EBITDA
10,521
8,859
17,043
27,183
29,172
474
8,509 4,484
6,371 4,552
13,780 10,556
23,356 16,498
25,297 16,775
411 273
EBIT Profit after Taxes
Source: OGDCL Annual Report (1998-2002) 1.
Income statement figures converted at average exchange rate of PKR 61.53/USD for FY2002
Figures 17 & 18: OGDCL Sources of Revenue (2002) Natural Gas 64%
Non-Operated 16% LPG 3% Others 6%
Crude Oil 27% Operated 84% Source: OGDCL Annual Report and OGDCL
15
Summary of Key Information
3. Company Overview (cont’d) 3.5
Financial Highlights (cont’d)
Table 5: PGCL Summary Financials PKR million
US$m(1)
1998
1999
2000
2001
Total Revenue
1,721
1,262
2,081
2,764
2,196
36
EBITDA
1,471
1,025
1,670
1,915
1,406
23
EBIT
1,311
885
1,318
1,547
1,064
17
860
550
704
1,073
875
14
Profit after Taxes
2002
200 2
Source: OGDCL Annual Report (1998-2002) 1 . Income statement figures converted at average exchange rate of PKR 61.53/USD for FY2002
3.6
Operating Costs and High Netbacks
One of the important contributors to OGDCL’s profitability is the low operating cost of the Company. The operating expenses form less than 20% of the total revenue and stood at USD 1.58 per barrel oil equivalent for FY 2002. Figure 19: OGDCL Uses of Revenue (FY2002) Operating expenses 15%
Profit after tax 40%
Royalty 10% Transportation 1% Amortization 4% Exploration writeoff 3% G&A 1% Taxes 21% WPPF 3%
Source: OGDCL 2001 Annual Report
Financial charges 1%
16
Summary of Key Information
4. Key Contacts The GoP has appointed Merrill Lynch and KASB as its Financial Advisor in relation to the sale process. All enquiries in relation to the process should be directed to the Merrill Lynch and KASB representatives set out below:
Andrew Shrager (Principal Contact) Senior Advisor – E&P London Tel.: +44 20 7995 4195 Fax.: +44 20 7867 4454 Email: [email protected]
Nadir Rahman Chief Executive Officer Karachi Tel.: +9221 2636302 Fax.: +9221 2630202 Email: [email protected]
Azhar Iqbal Hussain Regional Manager Islamabad Tel.: +9251 280 0242 ; +9251 111 222 000 (Ext. 222) Fax.: +9251 111 222 001 Email: [email protected]
17
Summary of Key Information
Annexure A: OGDCL – Operated & JV Interests Figure 21: OGDCL – Operated & JV Interests (Southern Region)
PALLI OGDCL
2568-8 TANDO ALLAH YAR OGDCL
MISAN OGDCL
PASAHKI & PASAHKI NORTH OGDCL
HUNDI OGDCL
THORA & THORA OGDCL EAST
TANDO ALAM
SARI SINGH OGDCL
L OC D NG O SO
MEYUN ISMAIL MEYUN ISMAIL DEEP
DARU OGDCL
2568-9 NIM OGDCL
BUZDAR OGDCL
KUNAR OGDCL LASHARI CENTER & SOUTH OGDCL
BUZDAR SOUTH DEEP
SAKHI DEEP SAKHI JAGIR
KATO
ZAUR MUBAN
ZAUR DEEP
PANIRO
RIND JALAL JUNATHI SOUTH
Badin-III BP
BAGLA OGDCL
NUR OGDCL
PIR
BH O 33PBA O O S 3(T 33O O (GU 72O(KHU G GO RG RB O M M C G D SHAL D P IK 33 O PO A ONA G OC L FIO C R(SO 3 G O N 2 G O K G A
JABO DH O (RG 29 A O 69 OG DC KH 30 30 (O KG H
PA O NA O G
LEGEND
RAJ
JANR OG D
Operated D&P / Min. Lease JV D&P / Min. Lease Operated EL / PCA JV EL / PCA
O K O HL PIO R PI G O G ZIN 286G L O O DC GL C
28 (ZA OM U R D
28 (KO O G TR QA O (BP G E F NV A O KAD L KIR LA L
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http://www.ppisonline.com
60 1 10
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310
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produced by:
Pakistan Petroleum Information 300 Software Technology ETC, Sir Agha Khan Service F-5/1, Park- 1Islamabad, Road, Tel: (92) 51 111 101 101 Fax: (92) 51 51 2879854, Pakistan E- mail: [email protected] Cyberplace: 2879855 http://www.lmkr.com
1 00 1
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LMK Resources ALandmarkGraphicsAffiliatedCompany
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In Collaboration with:
PPEPC
A Directorate General Petroleum Concessions Mr. G.A.
Director General Petroleum Concessions Sabri 1019-A Pak Plaza, Blue Area, Islamabad Tel: 92-51 -9204176 Fax: 92-51-9213245
18
Summary of Key Information
Annexure A: OGDCL – Operated & JV Interests (cont’d) Figure 22: OGDCL – Operated & JV Interests (Central Region)
DHODAK OGDCL PANJPIR OGDCL
2969-2 RAKHNI OGDCL NANDPUR OGDCL
3069-3 KHAJURI OGDCL
3070-5 KHARAR
OGDCL
BALOCHISTAN JANDRAN OGDCL
BLOCK 28 TULLOW
KOHLU OPPI
PIRKOH (ADD) OGDCL
PUNJAB
PIRKOH OGDCL
2868-1 ZIN (Old Block 29) OGDCL
2869-4 ZAMURDAN OPPI
LOTI OGDCL
UC H OGD CL 2867-4 KOTRA OGDCL
QADIRPUR OGDCL
INLD O P I R O
B H S A Y L -E O D G A N D C L A S A D K A L 3721K-0H O P LB O G D C LSAL O G D C L 3370 3 T -(M A LL) G 3(3U 715R -GALOTD )G O H D A C K L N I(USHALGARH) D H U N A L O B H P A IN G A ILK O M E S G W S ID A C A L C H G A N D C A L OGDCL O O P IR N 3 A S 7 H 1 0 P A - O A P LDH IN 3W 2 7D 3 1C -A O G D C L3 TOC D G O L OT M FIKA O G S D S C L ARK N C A U R A H N G A O A G S D IJC O (LH A O G L) O A L G D C LKR O G D C L
SARA S U R I T U L L O W
BADAR P E L
T U L L O W
A JO N D R N G D C LA
P R IKO H A (LDD)R O G D C O P K IG O D H C L 2 8 6olc8k2 -19) O LO T ZN IO (G d D lC B L G D C LI
D O G H D C L ODAK
PAN O G JP R D IC L NAN D P O G D C LUR
K O H U LPI O P 2 8 6 Z A M (U O R D P A P N I9 )4
UG HC C O D L
2 8 6 K (G O T D R C L A )74
S A R AW E S T T U L L O W
R (AK 29 H 69 2N -)I 3G 0 6 3 -RI OGDCL O K H D C A LJ9 U 3 07 0 5R -AR) K (H A O G DCL
Q A R D P O IU G R D C L B (P AD EA LR)
U S T O LW UR U S T O LW IARA
MIA O N F MV O D L IE
S A R U T O A LW E S T
MIA N O FI OMV E LD
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BHIT LASMO 2568-4 BITRISIM OGDCL
2568-5 SINJHORO OGDCL JAKHRO OGDCL
BOBI & DHAMRAKHI OGDCL
CHAK-5 DIM SOUTH OGDCL
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19
Summary of Key Information
Annexure A: OGDCL – Operated & JV Interests (cont’d) Figure 23: OGDCL – Operated & JV Interests (Northern Region)
N.W.F.P
BHAL-SYEDAN OGDCL 3372-10 KHUSHALGARH POL
BASAL OGDCL
SADKAL OGDCL
3371-5 GURGALOT OGDCL
3370-3 TAL MOL
DHAKNI OGDCL
RATANA OPI
DHURNAL OPI
PINDORI POL
BHANGALI OPI
MISSA KESWAL OGDCL
CHANDA OGDCL ADHI PPL NASHPA 3370-10 OGDCL
TOOT
OGDCL
FIMKASSAR OGDCL
CHAK NAURANG OGDCL
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In Collaboration with:
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Directorate General Petroleum Concessions
Mr. G.A. Sabri
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Summary of Key Information
1
Merrill Lynch and KA SB Securities (Pvt.) Ltd. (“KASB”) have prepared this Summary of Key Information on behalf of the Government of Pakistan (“GoP”), which is seeking expressions of interest from parties interested in acquiring a strategic interest in the Oil & Gas Development Company (“OGDCL”). This document has been prepared for the sole purpose of assisting recipients in assessing whether to submit an Expression of Interest to the Privatisation Commission (“PC”). This is not an offer document and is supplied for information purposes only and neither it nor its contents have been approved by or represent the views or plans of Merrill Lynch, KASB, GoP or OGDCL. This document is not intended to be an offer, invitation, solicitation or recommendation to any persons in relation to securities or financial instruments. This document does not purport to be comprehensive and is provided as background information only. In preparing this document, Merrill Lynch and KASB have obtained information from publicly available sources, GoP, PC and OGDCL. Merrill Lynch, KASB, GoP, PC or OGDCL nor any of its or their subsidiaries or controlling persons, nor any of their respective directors, officers, partners, employees, agents, representatives or advisers makes any representation or warranty, express or implied, or assume any responsibility whatsoever as to the accuracy, authenticity or completeness of the information, projections, assessments or opinions contained in this document or otherwise made available whether verbally, in writing, by electronic mail or otherwise by any other means whatsoever nor as to the reasonableness of any assumption contained herein or the basis for its preparation. Any demand, claim, dispute and/or liability arising therefrom or in connection thereto (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed. Nothing contained herein is, or shall be relied upon as, a promise or representation or warranty, whether as to the past or the future for any purpose whatsoever. Any estimates, projections, targets, assumptions or forecasts contained herein involve significant elements of subjective judgment and analysis which may or may not be correct. The information contained in the document is not an appraisal or valuation of all or part of OGDCL and does not take into account the impact of changes to the business of OGDCL, any potential transactions or a change in control. Merrill Lynch and KASB are not obliged to update or furnish any additional information on OGDCL to any recipient. No information set out in this document will form the basis of any contract. Any prospective investor may be required to acknowledge that it does not rely on, nor has it been induced to enter into such agreement by any representation or warr anty, save and except those expressly set out in such agreement. This document is not intended to form the basis of any investment decision or any decision to acquire any securities or other instruments. The document does not constitute an offer or invitation to purchase any securities or other instruments and its delivery to you shall not be taken as any form of commitment on the part of any person to proceed with any transaction. Merrill Lynch, KASB and their respective affiliates, officers, employees and representatives expressly disclaim any and all liability relating to or resulting from the use of this documentation such other information by a prospective investor or any of its affiliates, employees or representatives.
Summary of Key Information
List of Abbreviations 1P Reserves
Proven Reserves
2P Reserves
Proven plus Probable Reserves
3P Reserves
Proven, Probable & Possible Reserves
Bcf
Billion cubic feet
BHP Billiton
BHP Petroleum (Pakistan) Pty Ltd.
BP
BP Pakistan Exploration & Production Inc.
CAGR
Compounded Annual Growth Rate
E&P
Exploration and Production
EBIT
Earnings before Interest & Taxes
EBITDA
Earnings before Interest, Taxes, Depreciation & Amortisation
ENI
LASMO Oil Pakistan Limited
EoI
Expression of Interest
GoP
Government of Pakistan
LPG
Liquefied Petroleum Gas
MGCL
Mari Gas Company Limited
mmbbl
Million barrels
mmboe
Million barrels oil equivalent
mmcf
Million cubic feet
mmcf/d
Million cubic feet per day
OGDCL
Oil & Gas Development Company Limited
OMV
OMV (Pakistan) Exploration G.m.b.H
PAT
Profit after Tax
PC
Privatisation Commission
PGCL
Pirkoh Gas Company (Private) Limited
PKR
Pakistani Rupees
POL
Pakistan Oilfields Limited
PPL
Pakistan Petroleum Limited
RSOQ
Request for Statement of Qualification
SOQ
Statement of Qualification
Tcf
Trillion cubic feet
Tullow
Tullow Pakistan (Development) Limited
USD
US Dollars
2
Summary of Key Information
3
Table of Contents 1. Introduction
4
2. E&P Industry in Pakistan
5
2.1
Overview of Pakistan Energy Sector
5
2.2
Energy Supply & Demand
6
2.3
Industry Participants
7
3. Company Overview 3.1. OGDCL Asset Portfolio
9 9
3.2
Portfolio Upside
11
3.3
Exploration
11
3.4. Operational Performance
12
3.5
Financial Highlights
13
3.6
Operating Costs and High Netbacks
15
4. Key Contacts
16
Annexure A: OGDCL – Operated & JV Interests
17
Summary of Key Information
4
1. Introduction The Government of Pakistan (“GoP”) intends to privatise Oil & Gas Development Company Limited (“OGDCL” or “Company”). In this regard, the Privatisation Commission (“PC”) of the GoP has invited Expressions of Interest (“EoI”) from strategic investors to acquire 51% of the GoP shareholding in OGDCL. Acquisition of this shareholding will involve the transfer of management control to the investor. The privatisation of OGDCL offers a unique investment opportunity for large oil and gas companies to assume a leading role in the domestic E&P sector in Pakistan. Established in 1961 by the GoP to undertake exploration and development of oil and gas resources in the country, OGDCL has the largest exploration and production (“E&P”) portfolio in Pakistan. OGDCL carries on activities in various concessions in the Northern, Central, and Southern regions of Pakistan with: §
Remaining proven plus probable (“2P”) reserves of 1.35 billion boe (9.1 Tcf raw gas and 172 mmbbl oil as of Jan 1, 2003), of which 86% are operated.
§
Material positions in 4 major developed gas fields
§
Production of over 130,000 boe per day (780 mmcf/d sales gas and 25,000 bbl/d oil)1
§
Significant scope for appraisal and development (2.1 billion boe remaining proven, probable and possible (“3P”) remaining oil and raw gas reserves) as of Jan 1, 2003
§
Largest onshore acreage position in Pakistan with considerable exploration upside
§
Most extensive E&P database in Pakistan, developed over four decades of successful E&P activity
§
FY2002 revenue of US$647 million, net operating cash flow of US$314 million and profit after tax of US$273 million
Pakistan currently imports oil to meet a material part of domestic oil consumption requirements, and gas demand is forecast to exceed indigenous production by 2008. The increase in demand for gas presents an excellent opportunity for increasing exploration activities to cater to a ready gas market and realising the upside potential in OGDCL’s asset portfolio. Pakistan is prospective, particularly for gas. A number of international companies have made significant discoveries in the country in recent years and have already developed or committed to develop these fields. The offer for sale of a strategic interest in OGDCL is an integral part of the GoP’s reform and restructuring initiatives for the domestic oil and gas sector, shifting its role from an owner-operator to a regulator. The GoP’s objective is to also introduce modern and efficient management and technological systems to OGDCL by way of private sector participation.
1 365 Day basis for the period July 1, 2001 to June 30, 2002
5
Summary of Key Information
2. E&P Industry in Pakistan 2.1
Overview of Pakistan Energy Sector
The energy sector is vital to Pakistan’s continued economic growth. Total primary energy supplies in FY2002 were 337 mmboe, of which oil and gas constituted 84% (41% oil and 43% gas). Indigenous production, in 2002, represented 100% of gas consumption but less than 15% of domestic oil demand. Figures 1 & 2: Primary Energy Supplies (FY2002) mmboe 350
Local Oil Production 26%
300 250 200 150 100
Imported Crude Oil 74%
50 0 1998
1999 Oil
2000 Gas
2001 Others
2002
Source: Pakistan Energy Yearbook 2002
Over the period 1998-2002, on average 75% of natural gas was consumed by the power, fertilizer and domestic sectors. Over the same period, the main consumers of oil were the power and transport sectors, accounting for an average 80% of total consumption. Figures 3 & 4: Historical Natural Gas & Oil Consumption Natural Gas Consumption
Bcf 800
mmboe
Oil Consumption
140
700
120
600
100
500 80
400 300
60
200
40
100
20
0 1998
1999
2000
Power Domestic Commercial Transport (CNG) Source: Pakistan Energy Yearbook 2002
2001
2002
Fertilizer General Industries Cement
0 1998
1999 Power Others
2000 Transport Domestic
2001 Industrial
2002
Summary of Key Information
6
2. E&P Industry in Pakistan (cont’d) 2.1
Overview of Pakistan Energy Sector (cont’d)
Pakistan offers a competitive fiscal regime for the E&P sector, with the government take of 58-65% comparing favourably with countries such as India (68-70%) and Indonesia (85-88%)2 . In addition, the wellhead prices of oil and gas are indexed to international crude/HSFO prices with specified discount rates applicable to gas.
2.2
Energy Supply & Demand
Pakistan is largely a gas -producing country with indigenous gas constituting 43% of primary energy supplies in FY2002. Oil represents 41% of primary energy supply and is a major energy import for Pakistan, with 86% of the country’s oil demand met through crude oil and refined product imports in 2002. The GoP is focusing on the substitution of imported oil with indigenous resources both through enhancing local oil production, and increasing the share of gas in the energy supply. For the period 1998-2002, oil and gas consumption grew at a CAGR of 0.6% and 6.5 % respectively. A study conducted by independent consultants, M/s Beicip Franlab3 , estimates the average domestic gas demand growth rate to range from 4.3% to 7.1% p.a. over the next 20 years. The study also considers various gas supply scenarios taking into account the production from existing fields, recent discoveries and potential future discoveries. The study concludes that the Pakistan economy is likely to experience a gas shortfall between 2005 and 2008, based on the production from existing fields and commissioning of recent discoveries.
2 Source: IHS Energy Group 3 Natural Gas Import Study in Pakistan by M/s Beicip Franlab, September 1999 conducted under the auspices of the Asian Development Bank for the Government of Pakistan
Summary of Key Information
7
2. E&P Industry in Pakistan (cont’d) 2.3
Industry Participants
Pakistan has a vibrant and competitive oil and gas sector with the active participation of several multinational E&P and integrated companies. §
There are currently 24 operating companies in the sector and a further 16 in joint ventures. §
Among the four locally incorporated companies, two are state-owned and managed, viz OGDCL and Pakistan Petroleum Ltd. (“PPL”); two are locally incorporated and public listed, viz. Mari Gas Co. Ltd. (“MGCL”) and Pakistan Oilfields Ltd. (“POL”); and the remaining operators are international companies, including: § § § § § § § § § § § §
BHP Billiton BP ENI Kufpec Novus Petroleum Occidental OMV Petronas Premier Shell TotalFinaElf Tullow
The rapid commercialisation of recent discoveries including Zamzama (BHP), Sawan (OMV) and Bhit (ENI) has reinforced the confidence of the international E&P companies and private sector investors in the GoP’s commitment to maximize the use of indigenous gas resources on a fast-track basis. Increasing investment and participation in the sector has also been prompted by: §
Introduction of the Petroleum Policies 1994, 1997 and 2001 which provide attractive fiscal incentives for onshore and offshore exploration;
§
Attractive contractors’ take ranging between 35-42% (after deduction of taxation and royalties);
§
Competitive process for obtaining an exploration license and acreage for all E&P operators ensuring fair play;
§
Introduction of the Model Petroleum Concession Agreement; and
§
Introduction of Model Production Sharing Agreement for offshore areas.
8
Summary of Key Information
2. E&P Industry in Pakistan (cont’d) 2.3
Industry Participants (cont’d)
The holding of reserves and shares in production of existing participants is shown below. Figures 5 & 6: Pakistan Oil & Gas Reserves Status (by Operator) Oil
Gas
Total Remaining Recoverable: 300 mmbbl
Total Remaining Recoverable: 26.98 Tcf
OGDCL 49.7%
OGDCL 37.8%
Others 10.9%
BP 24.3%
ENI 5.6% POL 12.0% PPL Others BHP 8.2% 3.4% 2.4%
BHP 4.3% OMV 5.9% MGCL 20.3%
PPL 15.3%
Source: Pakistan Energy Yearbook 2002; Gross Operated Reserves status as of July 2002. No adjustment for JV shares.
Figures 7 & 8: Pakistan Oil & Gas Production (FY2001) (by Operator) Oil
Gas
Total: 23.2 mmbbl (63,548 bbl/d)
Total: 923.76 bcf (2,531 mmcf/d)
BP 47.2%
OGDCL 32.1%
PPL 35.8%
OGDCL 29.0%
ENI 2.6%
Others PPL 2.9% 3.8%
POL 14.0%
Others 4.4% BHP 3.6%
Source: Pakistan Energy Yearbook 2002, for t he period July 2001 – June 2002
BP 8.5%
MGCL 16.2%
9
Summary of Key Information
3. Company Overview The privatisation of OGDCL offers the opportunity for a strategic investor to acquire a majority stake in Pakistan’s leading oil and gas company. The Company’s asset portfolio includes developed fields with material production as well as un-drilled exploration leads and prospects.
3.1.
OGDCL Asset Portfolio
OGDCL is comparable in size to large international oil companies, and its portfolio is also diversified with respect to risk. The Company’s prime developed assets (Qadirpur, Uch, Dhodak and Pirkoh) offer attractive cash flows to sustain further exploration and development activities. Figure 9: Comparable Company 1P Reserves (31-Dec-01) 1P Reserves (mmboe) 2,500.0 2,000.0 1,500.0 1,000.0 500.0
Oil Source: Blackwatch Petroleum Services Limited, Herold
Gas
Woodside
PTT E&P
OGDC OGDCL
Talisman
Apache
KerrMcGee
Devon
Unocal
CNOOC
Burlington
Anadarko
0.0
10
Summary of Key Information
3. Company Overview (cont’d) 3.1.
OGDCL Asset Portfolio (cont’d)
OGDCL operates 34 producing and 14 exploration concessions, with significant non-operated interests in another 24 producing and 6 exploration concessions. Table 1: Summary of Major OGDCL Oil & Gas Fields January 1, 2003 2P Recoverable Reserves Oil (mmbbl) Major Fields Qadirpur Uch Pirkoh & Loti Dhodak Subtotal Northern Fields Southern Fields Central Fields Non-Operated Fields TOTAL
Gas (Bcf)
2.7 29.9
2,866.5 2,979.6 804.9 555.5
32.5 56.7 53.8 28.7
7,206.4 356.1 257.5 349.5 952.2
171.8
9,121.8
All figures represent OGDCL net share, including Qadirpur (75%) Source: Blackwatch Petroleum Services Limited, OGDCL
Operated fields represent 86% of OGDCL’s reserves, as of January 1, 2003. Figure 10: OGDCL’s Petroleum Reserves in Operated and Non-operated Concessions NonOperated 14%
Operated 86% Source: Blackwatch Petroleum Services Limited, OGDCL
In addition, OGDCL has an in-house technical services division, which provides services to its E&P division as well as to external clients. The range of services provided includes seismic data acquisition and processing, drilling and related services, wireline logging, and construction and genera l support services.
11
Summary of Key Information
3. Company Overview (cont’d) 3.2
Portfolio Upside
OGDCL’s estimated remaining proven, probable and possible “3P” reserves of 2.1 billion boe (13.1 Tcf raw gas and 289 mmbbl oil)4 offer a significant scope for appraisal and development. Furthermore, OGDCL’s asset portfolio has additional commercial potential due to the high reserves to production ratio and the relatively modest application of proven and/or advanced technology. Figure 11: OGDCL Reserves – Upside Estimates
Possible Reserves
34%
66%
Proven & Probable Reserves
3P reserves = 2.1 billion boe Source: Blackwatch Petroleum Services Limited
3.3
Exploration
OGDCL has devoted significant investment to exploration activities over the past four decades and has made a number of major discoveries. OGDCL has the largest acreage position in Pakistan and currently operates 14 exploration concessions (over 20,000 acres) and holds non-operated working interests in another 6 exploration concessions (over 25,000 acres).
4 Based on a conversion facts of 1 boe = 5.80 million BTU; gas reserves for individual fields converted according to individual heating values.
12
Summary of Key Information
3. Company Overview (cont’d) 3.4.
Operational Performance
OGDCL’s production has consistently increased over the last few years. During FY2002, the company produced, on average, 25,000 bbl/d crude oil and 780 mmcf/d gas5 . Total production in 2002 achieved a historical high, reflecting the completion of facilities work in some fields. The current production rate of many of OGDCL’s fields could be enhanced substantially. In particular, through the application of modern technologies and field management techniques, Qadirpur, Uch and Dhodak have the potential to produce at significantly higher levels than current production. Figures 12 & 13: Major Oil & Gas Fields by Net Production (FY2002) Gas Producing Fields
Oil Producing Fields
Non-OP 21%
Non-OP 14% Pasahki 24% Others 1% Sadkal 2%
Qadirpur 37%
Nandpur 7% Others 7% Dakhni 2% Missakeswal 2% Lashari C 3% Thora 4% Rajian 4% Sadkal 4%
Dakhni 2% Dhodak 5%
Dhodak 10% Sono 6%
Pirkoh & Loti 16%
Kal 6%
Uch 16%
Tando Alam 5%
Source: Blackwatch Petroleum Services Limited and OGDCL
OGDCL has demonstrated a strong track record of development and growth since its inception in 1961. With the implementation of a number of key development/expansion projects including Qadirpur, Uch, Loti, Panjpir, Sadkal, Bobi and Kunnar, the gas sales volume has increased at a CAGR of 10% for the period 1997-2002. Figure 14: Annual Sales Volume Growth(1) mmbbl 9.0
bcf 300.0
8.8
250.0
8.6 8.4
200.0
8.2
150.0
8.0 100.0 7.8 7.6 1998
1999
2000
Crude oil sales volume (LHS)
2001
50.0 2002
Gas sales volume (RHS)
Source: Company Annual Report (1998-2002) ( 1 ) Annual gas sales for OGDCL and Pirkoh. Annual crude sales exclude condensate production from Dhodak.
5 365 Day basis for the period July 1, 2001 to June 30, 2002
13
Summary of Key Information
3. Company Overview (cont’d) 3.4.
Operational Performance (cont’d)
The benchmark price used for gas, in all OGDCL pricing agreements, is the Saudi Arabian HSFO price, and for oil a basket of Middle Eastern crude. Table 2, following, details average oil and gas prices realised by OGDCL over the last 5 years. Table 2: Historical Oil & Gas Prices
Avg. realized crude oil price (USD/bbl)
1998
1999
2000
2001
2002
13.30
11.79
21.11
23.63
20.70
1.48
1.28
1.56
1.87
1 .73
Avg. realized gas price (USD/mcf) Source: OGDCL Annual Report
The following table details OGDCL’s primary customers. Table 3: OGDCL Primary Customers Gas Pipeline Quality
Low Heating Value
Oil / Condensate
§ Sui Northern Gas Pipeline
§ Uch Power
§ Attock Refinery
§ Sui Southern Gas
§ Fauji Kabirwala Power
§ Pakistan Refinery
LPG § LPG marketing companies
Source: OGDCL
3.5
Financial Highlights
OGDCL is one of the largest and most profitable companies in Pakistan and has maintained a strong growth record with a CAGR of Profit After Tax (in PKR) at over 27% for the period 1998-2002. Net sales in the year ending June 30, 2002 totalled PKR 39.8 billion (US$ 647 million), representing a 5% increase over the previous corresponding period in local currency terms. Increased sales were driven by a combination of increased production and higher average realised prices. Figure 15: OGDCL Financial Performance (USD) USD million 700
USD Revenues CAGR: 14.6% USD PAT CAGR: 27.3%
600 500 400 300 200 100 1998
1999
2000 2001 Revenues Profit after Tax
Source: OGDCL Annual Report (1998-2002)
2002
14
Summary of Key Information
3. Company Overview (cont’d) 3.5
Financial Highlights (cont’d)
Pirkoh Gas Company Limited (“PGCL”) is a private limited company incorporated i n 1982, governed under the Companies Ordinance, 1984. PGCL is a wholly owned subsidiary of OGDCL and operates the Pirkoh gas field. However PGCL is not consolidated, for accounting purposes, with OGDCL. During the year ending June 30, 2001, PGCL net sales stood at PKR 2,196 million (USD 36 million), showing year-on-year decrease of 21% in local currency terms, primarily due to lower gas production. Figure 16: PGCL Financial Performance (USD) USD million USD Revenue CAGR: -2.7% USD PAT CAGR: -8.1%
50 40 30 20 10 0 1998
1999 Revenues
2000 2001 Profit after Tax
2002
Source: OGDCL Annual Repor t
Key financials for OGDCL and PGCL are highlighted in the following tables. Table 4: OGDCL Summary Financials PKR million
US$ m(1)
1998
1999
2000
2001
2002
200 2
Total Revenue
16,224
14,232
25,299
38,297
39,805
646
EBITDA
10,521
8,859
17,043
27,183
29,172
474
8,509 4,484
6,371 4,552
13,780 10,556
23,356 16,498
25,297 16,775
411 273
EBIT Profit after Taxes
Source: OGDCL Annual Report (1998-2002) 1.
Income statement figures converted at average exchange rate of PKR 61.53/USD for FY2002
Figures 17 & 18: OGDCL Sources of Revenue (2002) Natural Gas 64%
Non-Operated 16% LPG 3% Others 6%
Crude Oil 27% Operated 84% Source: OGDCL Annual Report and OGDCL
15
Summary of Key Information
3. Company Overview (cont’d) 3.5
Financial Highlights (cont’d)
Table 5: PGCL Summary Financials PKR million
US$m(1)
1998
1999
2000
2001
Total Revenue
1,721
1,262
2,081
2,764
2,196
36
EBITDA
1,471
1,025
1,670
1,915
1,406
23
EBIT
1,311
885
1,318
1,547
1,064
17
860
550
704
1,073
875
14
Profit after Taxes
2002
200 2
Source: OGDCL Annual Report (1998-2002) 1 . Income statement figures converted at average exchange rate of PKR 61.53/USD for FY2002
3.6
Operating Costs and High Netbacks
One of the important contributors to OGDCL’s profitability is the low operating cost of the Company. The operating expenses form less than 20% of the total revenue and stood at USD 1.58 per barrel oil equivalent for FY 2002. Figure 19: OGDCL Uses of Revenue (FY2002) Operating expenses 15%
Profit after tax 40%
Royalty 10% Transportation 1% Amortization 4% Exploration writeoff 3% G&A 1% Taxes 21% WPPF 3%
Source: OGDCL 2001 Annual Report
Financial charges 1%
16
Summary of Key Information
4. Key Contacts The GoP has appointed Merrill Lynch and KASB as its Financial Advisor in relation to the sale process. All enquiries in relation to the process should be directed to the Merrill Lynch and KASB representatives set out below:
Andrew Shrager (Principal Contact) Senior Advisor – E&P London Tel.: +44 20 7995 4195 Fax.: +44 20 7867 4454 Email: [email protected]
Nadir Rahman Chief Executive Officer Karachi Tel.: +9221 2636302 Fax.: +9221 2630202 Email: [email protected]
Azhar Iqbal Hussain Regional Manager Islamabad Tel.: +9251 280 0242 ; +9251 111 222 000 (Ext. 222) Fax.: +9251 111 222 001 Email: [email protected]
17
Summary of Key Information
Annexure A: OGDCL – Operated & JV Interests Figure 21: OGDCL – Operated & JV Interests (Southern Region)
PALLI OGDCL
2568-8 TANDO ALLAH YAR OGDCL
MISAN OGDCL
PASAHKI & PASAHKI NORTH OGDCL
HUNDI OGDCL
THORA & THORA OGDCL EAST
TANDO ALAM
SARI SINGH OGDCL
L OC D NG O SO
MEYUN ISMAIL MEYUN ISMAIL DEEP
DARU OGDCL
2568-9 NIM OGDCL
BUZDAR OGDCL
KUNAR OGDCL LASHARI CENTER & SOUTH OGDCL
BUZDAR SOUTH DEEP
SAKHI DEEP SAKHI JAGIR
KATO
ZAUR MUBAN
ZAUR DEEP
PANIRO
RIND JALAL JUNATHI SOUTH
Badin-III BP
BAGLA OGDCL
NUR OGDCL
PIR
BH O 33PBA O O S 3(T 33O O (GU 72O(KHU G GO RG RB O M M C G D SHAL D P IK 33 O PO A ONA G OC L FIO C R(SO 3 G O N 2 G O K G A
JABO DH O (RG 29 A O 69 OG DC KH 30 30 (O KG H
PA O NA O G
LEGEND
RAJ
JANR OG D
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O K O HL PIO R PI G O G ZIN 286G L O O DC GL C
28 (ZA OM U R D
28 (KO O G TR QA O (BP G E F NV A O KAD L KIR LA L
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Pakistan Petroleum Information 300 Software Technology ETC, Sir Agha Khan Service F-5/1, Park- 1Islamabad, Road, Tel: (92) 51 111 101 101 Fax: (92) 51 51 2879854, Pakistan E- mail: [email protected] Cyberplace: 2879855 http://www.lmkr.com
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In Collaboration with:
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A Directorate General Petroleum Concessions Mr. G.A.
Director General Petroleum Concessions Sabri 1019-A Pak Plaza, Blue Area, Islamabad Tel: 92-51 -9204176 Fax: 92-51-9213245
18
Summary of Key Information
Annexure A: OGDCL – Operated & JV Interests (cont’d) Figure 22: OGDCL – Operated & JV Interests (Central Region)
DHODAK OGDCL PANJPIR OGDCL
2969-2 RAKHNI OGDCL NANDPUR OGDCL
3069-3 KHAJURI OGDCL
3070-5 KHARAR
OGDCL
BALOCHISTAN JANDRAN OGDCL
BLOCK 28 TULLOW
KOHLU OPPI
PIRKOH (ADD) OGDCL
PUNJAB
PIRKOH OGDCL
2868-1 ZIN (Old Block 29) OGDCL
2869-4 ZAMURDAN OPPI
LOTI OGDCL
UC H OGD CL 2867-4 KOTRA OGDCL
QADIRPUR OGDCL
INLD O P I R O
B H S A Y L -E O D G A N D C L A S A D K A L 3721K-0H O P LB O G D C LSAL O G D C L 3370 3 T -(M A LL) G 3(3U 715R -GALOTD )G O H D A C K L N I(USHALGARH) D H U N A L O B H P A IN G A ILK O M E S G W S ID A C A L C H G A N D C A L OGDCL O O P IR N 3 A S 7 H 1 0 P A - O A P LDH IN 3W 2 7D 3 1C -A O G D C L3 TOC D G O L OT M FIKA O G S D S C L ARK N C A U R A H N G A O A G S D IJC O (LH A O G L) O A L G D C LKR O G D C L
SARA S U R I T U L L O W
BADAR P E L
T U L L O W
A JO N D R N G D C LA
P R IKO H A (LDD)R O G D C O P K IG O D H C L 2 8 6olc8k2 -19) O LO T ZN IO (G d D lC B L G D C LI
D O G H D C L ODAK
PAN O G JP R D IC L NAN D P O G D C LUR
K O H U LPI O P 2 8 6 Z A M (U O R D P A P N I9 )4
UG HC C O D L
2 8 6 K (G O T D R C L A )74
S A R AW E S T T U L L O W
R (AK 29 H 69 2N -)I 3G 0 6 3 -RI OGDCL O K H D C A LJ9 U 3 07 0 5R -AR) K (H A O G DCL
Q A R D P O IU G R D C L B (P AD EA LR)
U S T O LW UR U S T O LW IARA
MIA O N F MV O D L IE
S A R U T O A LW E S T
MIA N O FI OMV E LD
K A D A A N L S M W O A R I 2 56 8 3W - AR K (H E O G D C L )I B (T 2 5 I6 R 8 4C -S IM I) O G D L S N (S 2 5 IO 6 JH 8 5C -LO RO) CHA5 K-M DIG O D U TH A K JH R O D C LG O G D C L O B O & B O D IG H D C A LM R A K H I P O G A D L C LI M S G A IN D C L2568 T A (N O G D D O C 2 L5A 6L 8 A -H Y A R )O 9C -L O NIM G D
A R L K S M IT O HAR A BHI L S M OT
H U N D I G D C L S O G A N S D R C G ILHO
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60 1 100 2
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2568-3 KHEWARI OGDCL
KIRTHAR LASMO
LEGEND Operated D&P / Min. Lease JV D&P / Min. Lease Operated EL / PCA JV EL / PCA
BHIT LASMO 2568-4 BITRISIM OGDCL
2568-5 SINJHORO OGDCL JAKHRO OGDCL
BOBI & DHAMRAKHI OGDCL
CHAK-5 DIM SOUTH OGDCL
http://www.ppisonline.com p r o d u c e db y :
Pakistan Petroleum Information Service 300 Software Technology Park-1 ETC, Sir Agha Khan Road, F-5/1, Islamabad, Pakistan T e l : ( 9 2 ) 5 1 1 1 1 1 0 1 1 0 1F a x :( 9 2 ) 5 1 5 1 2 8 7 9 8 5 4 , 2 8 7 9 8 5 5 E-mail: [email protected]:http://www.lmkr.com
LMK Resources
A Landmark Graphics Affiliated Company
In Collaboration with: PPEPCA Directorate General Petroleum Concessions Mr. G.A. Sabri Director General Petroleum Concessions 1019-A Pak Plaza, Blue Area, Islamabad Tel: 92-51-9204176 Fax: 92-51-9213245
19
Summary of Key Information
Annexure A: OGDCL – Operated & JV Interests (cont’d) Figure 23: OGDCL – Operated & JV Interests (Northern Region)
N.W.F.P
BHAL-SYEDAN OGDCL 3372-10 KHUSHALGARH POL
BASAL OGDCL
SADKAL OGDCL
3371-5 GURGALOT OGDCL
3370-3 TAL MOL
DHAKNI OGDCL
RATANA OPI
DHURNAL OPI
PINDORI POL
BHANGALI OPI
MISSA KESWAL OGDCL
CHANDA OGDCL ADHI PPL NASHPA 3370-10 OGDCL
TOOT
OGDCL
FIMKASSAR OGDCL
CHAK NAURANG OGDCL
RAJIAN OGDCL
3273-1 SOHAWA OGDCL
KAL OGDCL
PIN L IP R O D
B H A S O L Y -G E D C L A N 721K-0H O B A S G A L D C L S O A G D K D A C L T (33 A 70 3 L -)L GU 3(R 3G7AO L1T)-5 3D (L O P U LN S M O G H D A C K IHALGARH) D H U R N O A LP I B H A N G O P A ILH O M K E S G W S D IC A S LA N A S H P C H G A N D C A LOGDCL O A O G D C 3 L3 7 1 0 -AO TOD G O L C OT M K F O IA S G A D R C LO N C A U R A H N G P O R A LD G K AA D JIIN C S O L (3 O H 2 G A 7 W D 3 1C -LA ) K A L G D C L
O D H G O D D C A K L G D C L R (29 6 A 9 2 -LKHN)I O G D C K H A U J3 R I0693 -O O G D C L 07 0 5R -O K (3 H A G A D R C L) JANO D G R D C A LN KH O P U LPI R P O K IG O D C L H A D (R D P K I)O O HG D C L N 28 Z I68 1O -O d (G lD o B cL kl 29) O LO G D C T LI Z C A M (U 2 O R D 8 P A 6 P N I9 )4 UG O H L C D
8 6 K (2G O T D R C L A )74
MO OF N IA D L IE V M
Q R P A U D R IG D C L B A (P E L D A R ) O
PUNJAB
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Pakistan Petroleum Information Service 300 Software Technology Park-1 ETC, Sir Agha Khan Road, F-5/1,Islamabad,Pakistan Tel: (92) 51 111 101 101 Fax: (92) 51 51 2879854, 2879855 E-mail: [email protected] Cyberplace: http://www.lmkr.com
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Directorate General Petroleum Concessions
Mr. G.A. Sabri
Director General Petroleum Concessions 1019-A Pak Plaza, Blue Area, Islamabad Tel: 92-51-9204176 Fax: 92-51-9213245
