KARACHI: The Oil and Gas Development Company Ltd’s (OGDCL) receivables mounted to Rs93.238 billion, including overdue amount of Rs57.742 billion as of September 30, which is adversely affecting its operations, sources said on Monday.
An official document of the company has underlined the need for an early resolution of this issue to ensure smooth running of exploration, drilling, development and production activities, the sources said.
It also stressed upon the need to timely discharge of statutory obligations, including payment of royalty, taxes and dividends, etc.
The exploration and prospecting expenditure of OGDCL declined to Rs665.278 million during the last quarter, which was Rs2.531 billion in the same quarter last year.
OGDCL presently holds largest acreage in Pakistan, covering an area of 61,084 sq-km, operating 34 exploration blocks, 22 blocks, including three offshore blocks with 100 percent interest and 12 blocks as operated joint ventures, the sources said.
In addition, OGDCL also has interest in seven blocks operated by other companies.
An official said that OGDCL had aggressive exploration and production plans and the infamous circular debt and rise in the receivables is the biggest challenge facing the future growth of the company.
“We are managing the routine operations, but initiating new projects require additional financing, which is actually burdening the company under the loans and the issues of returns are still unresolved.”
About the company’s exploration and development activities, sources said that techno-economic evaluation of offshore Indus-R and Eastern Offshore Indus-A is in progress.
In the Offshore Indus-G Block, an application has been submitted to the Directorate General of Petroleum Concessions (DGPC) for grant of 25 percent shares each to OGDCL, PPL, ENI and BPXA with the transfer of operator-ship to ENI.
The seismic crew of the company during July/September acquired 376 L.kms of 2-D seismic data in Mari East, Soghri and Mianwali blocks and 191 sq-km of 3-D seismic data in Sinjhoro and Tando Allah Yar blocks.
Furthermore, OGDCL also processed 458 L.kms of 2-D using in-house expertise along with the processing of 315 sq-km of 3-D through outsourcing, the sources said.
On the drilling front, OGDCL carried out its drilling operations on 14 exploratory, appraisal and development wells, including drilling and testing of 11 ongoing wells from the previous fiscal year, they said.
During the first quarter, nine new well locations were marked on ground, out of which two development wells, Rajian-6 and Uch-19 were spudded.
Subsequently, Qadirpur-43 Extended Reach Well (ERW) and Uch-32 development wells were also spudded during October, making a total of four wells during the current financial year, the sources said.
The company, however, could not start operations in 10 blocks due to unavailability of security clearance and cover from authorities concerned, which constitute 30.26 percent of the total awarded acreage, they said.
OGDCL has taken up the matter with the government of Balochistan and the Ministry of Petroleum and Natural Resources for early resumption of exploration activities in these blocks, the sources said.
Overseas exploration evaluation is in progress to obtain exploration blocks, they said, adding that the technical report on six exploration blocks in Gabbon, including two offshore (shallow water) and four onshore blocks with 25 percent working interest offered by ENI is being prepared. Also, a report on hydrocarbon potential of Myanmar (Burma) has been prepared, they added.