Is ExxonMobil close to making a mega oil discovery in Pakistan?

ExxonMobil is close to discovering huge oil reserves in Pakistan near the border with Iran, and those reserves could even be larger than the oil reserves of Kuwait, the Pakistani Minister for Maritime Affairs and Foreign Affairs Abdullah Hussain Haroon said.

Addressing business leaders at the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Haroon said that Exxon had drilled for oil close to the Iranian border and that the U.S. oil giant was optimistic about the find.

“Foreign investors are interested in coming to Pakistan, provided we manage to meet their standards and attract them to make investment,” the minister said in a statement published by the FPCCI.

According to Arab News, if the oil discovery in Pakistan turns out to be as large as expected, the country would rank among the world’s top ten oil producing countries, ahead of Kuwait.

Kuwait’s total proven oil reserves were 101.5 billion barrels at the end of 2017, according to the BP Statistical Review of World Energy 2018. The Kuwaiti reserves account for 6 per cent of the world’s total proved oil reserves, putting Kuwait among the top ten countries in terms of largest oil reserves per country after Venezuela, Saudi Arabia, Canada, Iran, Iraq, and Russia.

In Pakistan, ExxonMobil signed an agreement in May this year to take a 25-per cent working interest in the Indus Block G offshore Pakistan, where the other partners in the block are Italy’s major Eni and Pakistan’s Government Holdings Pvt Ltd and Oil and Gas Development Company Limited (OGDCL).

According to Arab News, Pakistan currently meets just 15 per cent of its petroleum demand with domestic crude oil production, while 85 percent of its demand is met with imports. With the high imports, and the higher oil prices in recent months, Pakistan faces a large current account deficit and spends a substantial portion of its foreign exchange reserves on importing oil.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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