A consortium of four Pakistani companies led by Pakistan Petroleum Limited (PPL) was awarded the exploration rights for Offshore Block 5 in Abu Dhabi’s second competitive block bid round. The award marks the first Pakistani company investment in and planned exploration for oil and gas in an Abu Dhabi concession as well as the first partnership between the Abu Dhabi National Oil Company (ADNOC) and Pakistani energy companies.
Other companies in the consortium include Mari Petroleum Company Limited, Oil and Gas Development Company Limited, and Government Holdings (Private) Limited.
Under the terms of the agreement, the consortium will hold a 100% stake in the exploration phase, investing up to $304.7 million toward exploration and appraisal drilling, including a participation fee, to explore for and appraise oil and gas opportunities in the block that covers an offshore area of 6223 km2 and is located 100 km northeast of Abu Dhabi.
“The PPL-led consortium is delighted to be selected for the concession award of Abu Dhabi’s Offshore Block 5,” said Moin Raza Khan, managing director and chief executive of PPL. “This award is not only a watershed moment for Pakistan and the Emirate of Abu Dhabi towards bilateral energy cooperation and economic links, but also offers an opportunity to strengthen strategic cooperation with ADNOC to share technical know-how and expertise.”
Following a successful commercial discovery during the exploration phase, the consortium will have a production concession to develop and produce the discoveries. ADNOC has the option to hold a 60% stake in the production phase, which is 35 years from the commencement of the exploration phase. The block offers the potential to create significant in-country value for the UAE over the lifetime of the concession.
In addition to drilling exploration and appraisal wells, the exploration phase will see the consortium leverage and contribute financially and technically to ADNOC’s mega seismic survey, which is acquiring 3D seismic data within the block area. The data already acquired over a large part of the block, combined with its proximity to existing oil and gas fields, suggest the concession area has promising potential.