Pakistan discovered a substantial gas deposit of 351.2 billion cubic feet (BCF) in the Shewa fields, North Waziristan, expected to last for around 17 years.
The country plans to inject 70 million cubic feet per day (mmcfd) from the Shewa-2 well into the national grid, which will boost domestic gas production by over 3% daily. This will help reduce reliance on costly fuel imports and save significant foreign exchange reserves.
Mari Petroleum’s 2024 Annual Report, published on September 3, revealed that 70 mmcfd of gas from Shewa-2 will soon be connected to the grid through a newly completed pipeline by Sui Northern Gas Pipeline Limited (SNGPL).
Sunny Kumar, an analyst at Topline Research, mentioned that the hydro testing of this pipeline is currently in progress. He further noted that Shewa’s gas reserves, as of June 2024, stand at 351.2 BCF, with a production lifespan of about 14 years at the current rate of 70 mmcfd.
The project faced delays due to security issues, but the pipeline was completed in August 2024. The gas will enter the grid after the commissioning of Early Production Facilities (EPF). Mari Petroleum’s report emphasized that this will not only boost gas production by more than 3% but will also diversify its production portfolio, resulting in significant revenue growth.
Following this news, Mari Petroleum’s share price rose by 1.93%, closing at Rs3,510.73 per share with a trading volume of 125,759 shares on the Pakistan Stock Exchange. Mari Petroleum holds a 55% stake in the Waziristan Block, with the Oil and Gas Development Company (OGDC) and Orient Petroleum Inc (OPI) holding 35% and 10%, respectively. The financial impact on Mari Petroleum is expected to be Rs60-65 per share, while OGDC’s share impact will be Rs1.2, based on oil and gas price assumptions of $80 per barrel and $5.9-6.0 per mmbtu (million British thermal units).
Several new appraisal and exploration wells, including the Spinwam-1 exploratory well spudded in May 2024, are planned to explore the full hydrocarbon potential of the Waziristan Block. Drilling for Spinwam-1 is expected to conclude by the third quarter of FY2024-25.
Data shows that Pakistan’s oil and gas reserves have reversed a decline, with oil reserves rising by 26% and gas reserves by 2% as of June 2024. This has extended the country’s oil and gas reserve lifespan to 10 and 17 years, respectively.
Mari Petroleum and OGDC have contributed significantly to this growth, with Mari’s oil reserves doubling since December 2023, along with a healthy increase in gas reserves.