KARACHI, Jun 05, 2007 (Dow Jones Newswires)
Pakistan granted a license to a joint venture led by a local firm for oil and gas exploration in the south of the country, the Ministry of Petroleum and Natural Resources said Tuesday.
The joint venture, Pakistan's New Horizon Exploration and Production Ltd. and Kuwait Energy Co., will invest about $16.05 million to explore the Kunri Block in the southern Sindh province.
The block covers an area of 2,485.93 square kilometers
"The joint venture has committed to drill three exploratory wells during the initial term of first three years," the ministry said in a statement.
As Pakistan meets more than 80% of its energy requirements through imports, including about $3 billion worth of crude a year, the government has been encouraging domestic and foreign firms to increase exploration activities in the country.
In recent years, Pakistan's liberal policy has attracted a number of foreign firms in the exploration and production of hydrocarbons, making it one of the largest foreign investment areas.
The country is still struggling to increase domestic oil production to about 65,000 barrels a day. It hopes to produce 100,000 barrels a day within five years.
Pakistan also produces little over 3.5 billion cubic feet of natural gas a day, which meets 50% of its total energy needs.
The government has set a target of drilling 100 exploratory wells each year, compared with an average of 60 a year previously.
According to official estimates, Pakistan has 27 billion barrels of estimated oil reserves, of which only 3% has been explored.
It also has an estimated 280 trillion cubic feet of natural gas reserves, of which only 42% has been explored so far.
Copyright (c) 2007 Dow Jones & Company, Inc.
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