ISLAMABAD: The Government is likely to allocate 16 MMCFD from Togh Field (Kohat) to Sui Northern Gas Pipelines Limited (SNGPL) on commercial basis, subject to the approval of Field Development Plan and Production & Development lease, sources close to Energy Minister told Business Recorder.
The Togh Field, governed under Kohat Petroleum Concession Agreement (PCA), is located in district Kohat of Khyber Pakhtunkhwa. The Kohat Joint Venture (JV) comprises Oil and Gas Development Company Limited (OGDCL) with 50% share as an operator, Mari Petroleum Company Limited (MPCL) with 33.33% share and Saif Energy Limited with 16.67% share.
As per the provisions of Petroleum Policy 2001, the producer/ JV may request the government to purchase pipeline specification gas through its nominated buyer which is effectively controlled by it. Accordingly, earlier on the request of OGDCL up to 9 MMCFD gas from Togh-01 well was allocated to Sui Northern Gas Pipelines Limited (SNGPL) during the Extended Well Testing (EWT) period. Now the JV has drilled and tested another well, i.e., Togh Bala with estimated gas production of 6.5 MMCFD.
OGDCL and JV partners of the Kohat concession terminated the EWT at Togh-01 from December 25, 2020 and decided to sell gas to SNGPL on commercial basis since gas sale during EWT entails discount on a price of gas. Further, as per the request of operator gas from Togh Bala is required to be allocated to SNGPL.
The sources said the Directorate General of Petroleum Concessions/ Petroleum Division has approved Declaration of Commerciality over Togh Field in accordance with Article 6 of Kohat Petroleum Concession Agreement (PCA) and Rules 24(1) and 52(d) of Pakistan Petroleum (Exploration & Production) Rules, 2001 with effect from December 25, 2020.
Under the provisions of Petroleum Exploration & Production Policy and the rules made there under, a commercial discovery allows the producers to sell the gas on commercial basis subject to condition that adequate pipeline/ facilities have been developed, and grant of Development and Production (D&P) lease.
After explaining entire background, Petroleum Division has proposed that up to 16 MMCFD gas from Togh Field may be allocated to SNGPL on commercial basis subject to the approval of Field Development Plan and Production & Development lease.
The wellhead price of the gas will be decided by the concerned regulator under the applicable rules and policy.
According to sources, the proposal has been circulated to the Ministries of Finance, Planning, Development & Special Initiatives, Industries & Production and Power Division for comments. All the Divisions have supported the proposal, however, Power Division conveyed ‘nil’ comments.
Copyright Business Recorder, 2022
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