Pakistan oil companies eye BP's local assets

Pakistan state-owned oil companies, The Oil and Gas Development Co. Ltd. (OGDCL), the country's biggest listed firm, and Pakistan Petroleum Ltd (PPL), are mulling a joint bid for BP's assets in Pakistan, according a Reuters today report.

Citing sources close to OGDC, Reuters said, "OGDCL and Pakistan Petroleum Ltd are together conducting due diligence and would decide whether to bid after recommendations by its consulting firm Barclays PLC.''

According to a July UBS analyst's research note, BP's assets in Pakistan is worth around $690 million.

If OGDCL and Pakistan Petroleum do decide to bid, they would have to make an offer before the 6 December deadline set by the London-based oil company.

BP had in July announced that it would sell $30 billion of assets over 18 months in order to fund the Gulf of Mexico oil spill.

As part of this fund raising, BP had put its Asian assets in Vietnam and Pakistan for sale apart from other global assets.

BP's Pakistani assets, which contribute 14 per cent of Pakistan's total oil production and 6 per cent of its domestic gas production, comprise nine producing and exploration onshore blocks and four offshore exploration blocks in the Arabian Sea.

OGDCL, which already holds stakes in BP's oil assets in Pakistan, has the option of bidding or waiting for others to make an offer, in which case BP will have to offer OGDCL the right to match the offer under pre-emptive rights.