POL discovers oil, gas reserves in Tal Block

Pakistan Oilfields Limited (POL) on Monday said that it had discovered new reserves of hydrocarbons in its Tal Block. "Hydrocarbons have been encountered as a result of third and fourth Drill Stem Test (DST) conducted at the Mardankhel-1 well to test the potential of Hungu and Lockhart formations," the company intimated its shareholders at Karachi, Lahore and Islamabad stock exchanges on Monday.
According to testing results of the well, the company would be drilling 1910 barrels per day condensate and 23.22 mmscfd gas from the Hungu and Lockhart formations with 4820 pounds per square inch (psi) flowing wellhead pressure. With zero water quantity, choke size for the new discovery stands at 32-64 for each of the two formations. Citing the information it received from the operator of TAL Block, POL said production from the well was expected to start during the second quarter of next year (2016). "Actual flow rate may differ from the rates mentioned above," it said.
For optimum production, the petroleum firm added, the well was currently planned to be produced simultaneously from Lumshiwal, Hungu and Lockhart formations. While the production from Samanasuk formation is planned at the later stage considering the reservoir condition, it said. A DST is a procedure for isolating and testing the surrounding geological formations through the drill stem. The test is a measurement of pressure behaviour at the drill stem and is a way to obtain important fluid sampling information and to establish the probability of commercial production. "Accordingly, it should be borne in mind that actual production may differ significantly from the test result is," the company said.
The pre-commerciality working interest of POL stands at 25 percent. The good news reflected positively on the listed shares of POL on Karachi stocks market where the stock rallied to eventually close 1.5 percent higher. The cumulative positive earnings impact of the impending successful testing of hydrocarbon reserves in Maramzai-3 and Makori-East 4, JS analyst Ahmed Saeed Khan estimated, would be around Rs 9 per share. Mohammad Rizwan of Topline Securities also saw some interest in POL after the company announced the discovery.