Research Analyst
June 8 - 14, 2009


Oil & Gas Development Company Ltd (OGDCL) is national oil and gas company of Pakistan and the flagship of the country's exploration and production (E&P) sector. The OGDCL's primary objective is to enhance its reserves and production profile and ultimately maximize the value for shareholders in Pakistan. The Company is well equipped to ride on the wave of E&P activity, Business and Strategic Plan, a debt-free and robust balance sheet and healthy cash reserves. The company is listed on all three stock exchanges in Pakistan and on the London Stock Exchange since December 2006.


During March 31 2009, OGDCL was operating in 41 Exploration Blocks (26 blocks with 100% share and 15 blocks as operated JVs) including 5 Offshore Blocks covering an area of 76,651.06 Sq.Kms and one Reconnaissance Permit over Jhampir covering an area of 1,326.62 Sq.Kms. Exploration Blocks held by OGDCL constitute 31.52% of the Country's total exploration acreage. During July-March 2009, OGDCL surrendered four exploration blocks namely Dhermund, Bagh-o-Bahar, Pakhiwala, and Dhok Sultan.


The financial results and achievements of the company are driven by its strategies of increasing oil and gas reserves through accelerating exploration and strengthening of oil and gas production. During the nine months ended 31-March 2009, the Company's product sales revenue increased by Rs 11.379 billion to Rs 100.206 billion, a growth of 12.8% over the same period last year. Increase in sales revenue is mainly driven by high prices in rupee terms, which contributed Rs 16.069 billion towards increase in sales revenue. However, decline in sales volume of Crude Oil, Gas, LPG, Sulphur and other refined petroleum products resulted in a decrease of Rs 4.690 billion in sales revenue.

Profit before taxation for the period was Rs 66.273 billion compared to Rs 56.858 billion for the corresponding period last year, reflecting 16.6% increase in company's earning performance. Profit after taxation during the period was Rs 44.408 billion compared with Rs 36.305 billion for the corresponding period last year. Consequently, Earnings per Share (EPS) raised to Rs 10.33 from 8.44, an increase of 22.3%. Net cash used in payment of dividends was Rs 21.292 billion as against Rs 24.653 billion. Cash flow from operating activities, and net cash utilized in investing and financing activities resulted in a net cash decrease of Rs 4.681 billion to ending cash balance of Rs 13.596 billion.

(Rs. 000)



  2009 2008
Sales Net 100,231,295 88,877,523
Gross Profit 71,503,924 64,307,420
Profit Before Tax 66,272,958 56,857,601
Profit After Tax 44,408,171 36,305,232
EPS (Rs) 10.33 8.44
Source: OGDCL


The Company is actively working on the development projects like UCH-II Development, Qadirpur Gas Compression, Dhakni Expansion, Sinjhoro Development, Kunnar & Pasakhi Deep (KPD)/Tando Allah Yar (TAY) Integrated Development, Sara West Development & Jhal Magsi and efforts are being made to complete these projects on an accelerated pace.


PRODUCTS UOM 9M 2007-08 9M 2008-09
Crude Oil Barrels/day 43,642 41,487
Gas MMcf/day 986 988
LPG M. Tons/day 368 226
Sulphur M. Tons/day 71 66
~ Daily production has been worked out at 365 days/year.

During the nine months period, the Company's crude oil production from Company's 100% owned fields and share in operated JV (Joint Venture) fields decreased by 2.5% mainly due to decline in production from Dhodak, Thora, Lashari, Bobi, Sono and Chanda fields. The decline was partially offset by increase in production from Kunnar, Pasahki, Mela and start of production from Moolan North and Chak-66 NE fields. Share of crude oil production from non-operated JV fields dipped by 19.3% resulting into a net decrease in crude oil production by 4.9%.

Crude oil production from 100% owned fields and share in operated JV fields was on the lower side by 4.1% mainly due to non-achievement of forecast production from Thora, Lashari, Bobi, Qadirpur, and Mela fields on account of mechanical problems, natural decline at Dhodak and Lashari fields, non achievement of natural production from Kal-3, and delay in completion of Chanda-3.

However, production from Sono, Pasahki, Rajian and Kunnar fields was higher than the business plan targets. Company could not achieve targeted share of crude oil production from non-operated JV fields, which was lower by 1,318 barrel per day.

Company's gas production during the period was slightly higher than the business plan targets and actual gas produced during corresponding period. LPG production during the period decreased by 38.7% and 30.5% respectively mainly due to water break through at Dhodak field, abandonment of Dakhni Deep-3 & Dakhni SW as non producer and operational problems at Bobi field. Share of LPG production from non-operated JV fields was also on the lower side as anticipated in the business plan.


OGDCL should increase oil and gas production through development of new discoveries and implementation of projects on fast track basis. In order to increase oil and gas reserves base, the Company intends to carry out an aggressive exploration programme based on seismic surveys, drilling of wells and acquisition of new exploration acreage.