Quickly gaining the status of favoured stocks in the oil and gas exploration and production industry, Mari Petroleum Company Limited (PSX: MPCL) has performed significantly well compared to its peers amid low oil prices. Its latest annual financial performance also speaks volumes of its progress.
MPCL’s net revenues in FY17 increased by 30 percent year-on-year, while the bottom-line was up by 51 percent, year-on-year. The increase in earnings came from increased revenues due to rising volumetric growth as well as better prices. A significantly lower exploration and production expenditure in FY17 – down by 40 percent year-on-year – was also another factor that lifted the bottom-line.
The firm is the third largest gas explorer in the country and is moving ahead with aggressive E&P plans. As per the firm’s third quarter director’s report, MPCL has plans to drill 9 wells per annum over the next 3 years relative to 6 wells drilled in FY16; it will expand its exploration portfolio through fresh bidding for exploratory licenses, and has scaled up its projections for exploration capex significantly for the coming three years.
It is looking to diversify into power generation, planning a 400MW gas-fired plant in southern Punjab as per media reports. MPCL’s stock has been outperforming the benchmark index as well as its peers. It has remained in the limelight due to better earnings, revised GPA, and the government’s plan to divest its shareholding. In recent developments, Mari Petroleum has reportedly reached agreement for proposed acquisition of different blocks where Tullow has working interest, which includes 20 percent working interest in a block in Bannu West Block KPK, 95 percent working interest in Block 28, Balochistan and 30 percent working interest in Kalchas Block, Balochistan and Punjab.
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