Professional Documents
Culture Documents
Introduction
Pakistan Petroleum Limited (PPL) is one of the pioneer exploration and production (E&P) companies in
Pakistan oil and gas sector. On behalf of the Government of Pakistan (GoP), the Privatisation Commission
(PC) is proceeding with a strategic sale of 51% shareholding in PPL along with transfer of management
control.
Merrill Lynch International and KASB Securities (Pvt.) Ltd. (KASB) have been appointed as the Financial
Advisor (FA) for the strategic sale. In July 2004, the GoP successfully concluded an offer for sale and initial
public offering of 15% shares of PPL on the domestic stock exchanges.
The PC invited Expressions of Interests (“EOIs”) from interested parties on February 17, 2005. The Parties
submitting EOIs were requested to submit and Statements of Qualifications (“SoQs”) by April 30, 2005
whereby eleven parties submitted SoQs to the Privatisation Commission. Six parties were pre-qualified to
continue to the next stage of the privatisation process. As of August 2006 three pre-qualified parties were
ready to proceed for the bidding. However, the privatisation process is being reviewed in the light of the
Supreme Court's judgment in the Pakistan Steel Mills case.
Company Overview
PPL was incorporated in June 1950 with the Burmah Oil Company (renamed Burmah Castrol) and GoP as its principal
shareholders.
After more than 50 years of successful operations PPL continues to be a prominent E&P player in Pakistan with:
Sui, Pakistan’s oldest and largest gas field♣ discovered and operated by PPL,
contributing 25% of Pakistan’s gas production;
Remaining proven plus probable (2P) reserves of 6.9 tcf gas♣ and 39.6 mmstb
oil/NGL) as of June 30 2005;
Average FY2005♣ production of 948 MMcfd of natural gas and 1,759 bbld of crude
oil/NGL;
FY2005 revenues of PKR 23,294 million (US$ 388 million) and♣ profit after tax of PKR
8,623 million (US$ 144 million);
♣ Significant portfolio of non-operated assets, including Qadirpur, Sawan and Miano,
Block-22 and Tal;
Strong exploration track record and♣ prospective exploration portfolio, and
Replacement of PPL’s 1982 Gas♣ Price Agreement (GPA) with the 2002 GPA allowing
gas price increases under a phased 5-year program starting July 2002.
Company History
PPL was incorporated on June 5, 1950 whereby the company inherited the assets and liabilities of the Burmah Oil
Company Limited and commenced operations on July 1, 1952. At the time of incorporation, the Burmah Oil Company
held the majority stake of 70% with GoP accounting for 30% stake and the balance held by private Pakistani
shareholders. Burmah Oil divested 6% of its shares to the International Finance Corporation (IFC) in 1982, whereas in
1997 it sold the remaining shareholding to the GoP.
In July 2004, the Government successfully concluded a 15% offer for sale and IPO of the company on the domestic
stock exchanges at PKR 55 per share. The basic issue was for 10% shares with a green-shoe option of another 5% and
the entire issue was 3.7 times oversubscribed. The current shareholders of PPL are the Government of Pakistan
(78.35%), International Finance Corporation (6.09%) and institutional and individual investors (15.56%).
Organization
The Company’s holds operatorship of major oil and gas fields including Sui, Kandhkot,
Adhi and Mazarani, while its non-operated portfolio includes interests in the Qadirpur,
Miano, Sawan and Tal fields. The Company’s exploration portfolio includes operated and
non-operated joint ventures in 10 onshore blocks and 2 offshore blocks.
PPL holds joint ownership with the Government of Balochistan in Bolan Mining
Enterprises (BME), which is involved in the business of mining exploratory well-drilling
grade barite powder. BME is the operator of the Gunga barytes mine in Baluchistan.
Share of profit in BME at year end June 30, 2005 was PKR 29.263 million.
PPL’s head office is located in Karachi. The company’s total staff strength is about 2,536
employees including 640 management staff and 1,896 non-management staff.
The proven plus probable remaining recoverable reserves (2P) of PPL operated and non-
operated interests as of June 30, 2005 were 6.9 trillion cubic feet of gas and 39.6 million
standard barrels of oil/NGL. For the FY 2005, PPL’s average production was 948
mmcf/d gas and 1,759 bbl/d oil. The company’s share in average production from its
operated and non-operated joint venture fields are as follows:
PPL Production
FY 2003 FY 2004 FY 2005
Oil/NGL (barrels per day) 1,353 1,697 1,759
Natural Gas (million cubic feet per day) 910 942 948
Financial Data
PPL has an authorized share capital of Rs. 10 billion. The issued, subscribed and paid-up
capital is Rs. 6,860 million (686 million shares issued at a par value of PKR 10). The key
financial highlights of PPL are given below.
Key Contacts
SUCCESS STORY
Type Marktstudie
Year: 6/2008
Publisher: Global Markets Direct
Language: english
Availability: available
Critical appraisal of the company’s
positioning using SWOT analysis.
Company information, including business
descriptions, company history, product lines,
key competitors and key employee
biographies.
Features of this market research: • Support business/sales activities by understanding
customers businesses better.
• Identify prospective partners and suppliers.
• Capitalize on your competitors weaknesses and
target the market opportunities available to them.
18 pages
Pakistan Petroleum Limited Energy Oil & Gas
SWOT Report is a comprehensive report of the
company including both quantitative and qualitative
About this market survey: research. The report examines the company’s
business struct.....
Porter
“Strive for competitive advantage and the forces that affect it.”
Strategic Management
Dr. Cassell
By: Ashleigh Bender
Table of Contents:
Executive Summary:
Michael Porter created two concepts used by industries to either achieve greater
competitive advantage or can be used......
A
c
h
i
e
v
e
m
e
n
t
s
Year Event
Company Overview
Pakistan Petroleum Limited is the oldest and largest Exploration and Production
Company in the country was incorporated on 5th June 1950 subsequent to the
promulgation of the Pakistan Petroleum Production Rules, 1949 with the main
objective of conducting exploration, development and production of Pakistan's oil
and natural gas resources. PPL inherited all the assets and liabilities of the Burmah
Oil Company (Pakistan Concessions) Limited and commenced business on 1st July
1952.
PPL and its ex-parent Burmah Oil Company have been active in the subcontinent
since the early part of the 20th century. A total of 239 wells including 65
exploratory and 174 appraisal / development wells have so far been drilled which
resulted in the discovery of about 19.90 Tcf gas (both operated and non-operated
leases). A gas condensate/oil field at Adhi with original recoverable reserves of
1,253 MT liquefied Petroleum Gas and 39.4 MMbbl of oil/condensate was also
discovered by PPL.
The Company also operates a Baryte mine in Balochistan province. It produces oil
well drilling grade Baryte powder from the mine, which has proven reserves of 1.25
million tones. For the year 2004-05, PPL's share of average production from its
operated and non-operated fields was 953 MMcfd of gas, 1,372 bpd of oil/NGL and
26 tones per day of LPG. Production of gas from these fields meets about 25.1% of
the country's indigenous production. The gas, LPG and NGL production from PPL
operated and non-operated fields for the year 2004-05 in terms of oil equivalent,
was about 171,205 barrels of crude oil per day.
The Company has a staff of about 2520 as at 31 May, 2006 employees with about
431 qualified technical staff in the fields of engineering, computer and earth
sciences. PPL has well established IT department and all staff in the Head Office
has access to computers and are interconnected through Local Area Network (LAN).
The Wide Area Network (WAN) has also been established connecting PPL's three
major producing fields and Regional Office in Islamabad with the Head Office at
Karachi. The Company has implemented SAP in 2004 integrating core business
processes using Costing, Finance, Human Resources, Materials Management, Plant
maintenance and Project Systems modules.
The Government of Pakistan (GoP) in September 1997 purchased the entire equity
interest of Burmah Castrol PLC, formerly Burmah Oil Company, in the Company
(comprising 21 million ordinary shares of Rs.10 each) representing 63.91 percent
of the Share Capital thereby increasing its holding in the Company to 93.35
percent. Subsequent to June 2004, the GoP has disinvested a portion of its equity
in the Company equivalent to 15% of the paid up share capital of (i.e. 102.873
million shares of Rs.10 each) through an Initial Public Offering (IPO). The GoP has
made a policy decision to privatize PPL and IPO is a significant step towards this
direction.
A consortium led by Merrill Lynch International and KASB securities (Pvt) Limited
have been appointed by the Privatization Commission (PC) as the Financial Advisor
(FA) for the strategic sale of GoP's 51 % interest in the company. Five (5) parties
were prequalified as potential bidders for the transaction. The Government of
Pakistan continues to pursue the privatization process through sale of its majority
interest in the Company to a strategic investor and remains committed to proceed
with the transaction with a view to concluding the process at an early date.
Pakistan Petroleum Limited (PPL), the pioneer of the natural gas industry in the
country, has been a frontline player on the exploration and production sector for
well over five decades. The company follows an aggressive strategy to not only
maximize production but also replenish existing reserves and venture into
untapped areas. Today, PPL contributes around 26 percent of the country's total
natural gas production besides producing crude oil/ Natural Gas Liquids (NGL) and
Liquefied Petroleum Gas (LPG).
Starting out concurrently with the first major gas discovery at Sui in 1952, PPL now
operates four producing fields at Sui, Kandhkot, Adhi and Mazarani and holds
working interest in seven partner-operated producing fields. PPL’s exploration
portfolio comprises 24 exploration blocks, including four that are offshore. On June
30, 2008, the company’s hydrocarbon reserves stood at approximately 3.71 trillion
cubic feet of natural gas, 23.3 million barrels of oil/NGL and 321,000 tonnes of
LPG.
RECENT INITIATIVES
Besides its 22 existing exploration blocks held locally and one concession held in
Yemen, PPL has applied for grants in new areas. In 2006 – 2007, PPL discovered
natural gas and condensate from its exploratory well Adam X-1 (Hala Block)
located in Sanghar District, Sindh, where PPL is the operator with a 65 percent
stake. Three discoveries were also made in partner-operated Nashpa, Gambat, Latif
and Tal blocks.
Though it is imperative to find new oil and gas reserves, the need of the hour is to
put in extra efforts to maximize existing production levels from operative fields.
This is only possible if innovative and modern techniques are adopted. For instance,
hydrocarbon production from the PPL-operated Adhi Field doubled when the second
LPG/NGL recovery plant started functioning in September 2006. Since then, the
average daily production capacity of the field has gone up to 40 million cubic feet
(MMSCF) natural gas, 130 tonnes LPG and 4,500 barrels of oil.
At Kandhkot Gas Field, PPL has started work to install a gas compression facility.
Likely to be the biggest after the Sui Field Gas Compressor Station, this facility is
expected to be operational by 2009 and maintain contractual gas pressure,
maximizing gas recovery.
From 2002 – 2008, the processing capacity of partner-operated Qadirpur Gas Field
nearly doubled to 500 MMSCFD, Miano Gas Field was commissioned and Sawan
Phase I and Phase II resulted in enhancement of capacity. In addition, early
production facilities of Manzalai and Makori discoveries in Tal Block were
commissioned and production started from Mela-1 discovery at Nashpa Block.
PPL also plans to conduct studies to further increase gas recovery from Sui,
Kandhkot and Adhi. Major capital projects for the next 10 years include addition of
high pressure casings for Sui Upper Limestone Compressor at Sui Field Gas
Compressor Station and upgradation of Sui Main Limestone compressors. PPL also
aims to produce additional gas from Sui Pab Reservoir and commission the
Kandhkot Well Head Gas Compression Project and Dehydration Plant. Installation of
compression facility at Qadirpur, Miano, Block 22 and Sawan fields is also on the
cards just as Central Processing facilities are planned at Tal.
PPL featured among the “Top 25 Companies” of the Karachi Stock Exchange, was
conferred “Pakistan’s Corporate Excellence Award” by Management Association of
Pakistan, bagged for the third consecutive year “Pakistan Corporate Philanthropy
Award” given by Pakistan Centre for Philanthropy, won the “Best Corporate Report
Award” judged by a joint committee of the Institute of Chartered Accountants of
Pakistan (ICAP) and Institute of Cost and Management Accountants of Pakistan
(ICMAP). Additionally, PPL was conferred the “Environment Excellence Award”
instituted jointly by the National Forum of Environment and Health, United Nations
Environment Programme, Ministry of Environment, Government of Pakistan and
Federation of Pakistan Chamber of Commerce and Industry, for the second year
running.
These prestigious accolades are a befitting recognition of PPL’s efforts and serve as
a source to scale new heights of corporate excellence, sustainable growth and
prosperity.
PPL featured among the “Top 25 Companies” of the Karachi Stock Exchange, was
conferred “Pakistan’s Corporate Excellence Award” by Management Association of
Pakistan, bagged for the third consecutive year “ Pakistan Corporate Philanthropy
Award” given by Pakistan Centre for Philanthropy, won the “Best Corporate Report
Award” judged by a joint committee of the Institute of Chartered Accountants of
Pakistan (ICAP) and Institute of Cost and Management Accountants of Pakistan
(ICMAP). Additionally, PPL was conferred the “Environment Excellence Award”
instituted jointly by the National Forum of Environment and Health, United Nations
Environment Programme, Ministry of Environment, Government of Pakistan and
Federation of Pakistan Chamber of Commerce and Industry, for the second year
running.
These prestigious accolades are a befitting recognition of PPL’s efforts and serve as
a source to scale new heights of corporate excellence, sustainable growth and
prosperity.