Inside Financial Markets

Manzalai-10 in Tal Block has successfully tested for gas reserves.

Manzalai-10 in Tal Block has successfully tested for gas reserves.

  • While testing at Manzalai-10 is still underway, our industry channelchecks suggest a relatively modest gas discovery of 25-35mmcfd (~20%of gas flow from Manzalai).
  • We believe production from Manzalai-10 is likely to provide annual earnings upside of Rs0.2/share for OGDC, Rs0.5/share for PPL and Rs2.5/share for POL.
  • At current levels, Pakistan Oilfields (POL) is our preferred play in the E&P space with a Target Price of Rs553.

Man-10 tests for gas reserves; modest discovery expected

The latest PPIS activity report indicates successful testing of gas reserves at Manzalai-10, located in the Tal Block. While testing at Manzalai-10 is still underway, our industry channel checks indicate a relatively modest gas discovery of 25-35mmcfd, which will be 20% of total Manzalai gas flows, 12% of Tal Block gas flows and 1% of country’s gas flows. Oil and Gas Development Company (OGDC), Pakistan Petroleum Limited (PPL) and Pakistan Oilfields Limited (POL) have respective stakes of 27.8%, 27.8% and 21.1% in the block. We estimate production from Manzalai-10 is likely to provide annual earnings upside of Rs0.2/share for OGDC, Rs0.5/share for PPL and Rs2.5/share

Ali Nawaz

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