ECC Approves E&P Consortium’s Attempt for $400 Million Exploration in UAE

The government has permitted a consortium of Pakistan’s top exploration and development (E&P) companies in the public sector to proceed with a $400 million petroleum exploration attempt in the UAE.

The decision was announced by the Economic Coordination Committee (ECC) of the Cabinet in a meeting that was presided over by the Minister for Finance, Shaukat Tarin.

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The ECC approved a summary by the Petroleum Division and issued a no-objection certificate (NOC) for the issuance of corporate guarantees by all the companies in the consortium.

Pakistan’s three major oil and gas companies  — Oil & Gas Development Company Ltd. (OGDCL), Pakistan Petroleum Ltd. (PPL), and Mari Petroleum Company Ltd. (MPCL) – along with Government Holdings Pvt. Ltd. (GHPL) have formed a special purpose vehicle (SPV) for this project. They will have an equal shareholding of 25 percent or $100 million in the $400 million project over a period of five years.

The ECC has allowed the companies to issue guarantees called NewCo to the SPV in favor of Adnoc and SCFEA. These guarantees will qualify the consortium for the bid that it has already submitted.

In other news, the Petroleum Division also awarded five new Exploration and Production (E&P) blocks to the OGDCL.

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This decision was made in line with the government strategy to increase E&P activities in potential areas across the country.

Secretary Petroleum Dr. Arshad Mahmood and Director General (Petroleum Concessions) signed the Petroleum Concession Agreements (PCAs) and Exploration Licences (ELs) on behalf of the government, while the Minister for Energy (Petroleum Division) attended the signing ceremony. The OGDCL’s Managing Director, Shahid Saleem Khan, was also present at the occasion.